Blue Apron Inks Long-term Operations And Logistics Relationship With FreshRealm

(RTTNews) - Blue Apron Holdings, Inc. (APRN) announced Tuesday plans for a long-term operations and logistics relationship with FreshRealm, a leading provider of fresh meals to top retailers nationwide. The companies have signed a non-binding letter of intent for up to $50 million payable to Blue Apron for the transfer of its operational infrastructure, as well as when transition, efficiency and product milestones are met.

FreshRealm is the manufacturer of Blue Apron's popular line of Heat & Eat meals. The parties intend to sign definitive agreements and close the transaction on or about June 9, 2023.

Blue Apron plans to continue to drive its core direct-to-consumer business, including the creation and marketing of its product, customer data, customer support and consumer technology. The company does not expect changes to its existing revenue streams as a result of this relationship.

By shifting to this asset-light model, Blue Apron plans to focus on further growing its strong brand and delivering the high-quality products its customers have come to expect. The company also plans to add new convenience product options for a broader consumer base in the future.

The transaction is expected to enhance Blue Apron's balance sheet and drive additional corporate product, technology, general and administrative efficiencies alongside the asset-light model to support the company's goal of profitability.

At the closing of the transaction, Blue Apron would transfer its operational infrastructure to FreshRealm, including fulfillment centers, equipment, know-how and personnel.

In consideration of the transaction, Blue Apron expects to issue to FreshRealm warrants in an amount equal to 19.9% of the company's then-outstanding common stock with an exercise price of $.01 per share on the closing date of the transaction.