Grove Collaborative to Become a Publicly Traded Company

SAN FRANCISCO & NEW YORK --Grove Collaborative (“Grove” or “the Company”), a leading sustainable consumer products company, and Virgin Group Acquisition Corp. II (“VGII”) (NYSE: VGII), a publicly-traded special purpose acquisition company (SPAC) sponsored by Virgin Group, announced today they have entered into a definitive business combination agreement that will result in Grove becoming a public company. Upon closing of the transaction, the combined company will continue to operate under the Grove name and will be listed on the NYSE under the new “GROV” ticker symbol. The combined company will be led by Stuart Landesberg, Co-Founder and Chief Executive Officer of Grove Collaborative.

Grove is a leading sustainable consumer products company fueled by a mission to transform the consumer products industry into a force for human and environmental good. The largest independent, home and personal care brand focused on health and sustainability, the Company is at the forefront of the direct-to-consumer and natural products trends and has emerged as a leader in the category, with over 1.5 million active customers through its direct platform and millions of units of products sold at physical retail.

Earlier this year the digitally native company announced its entrance into physical retail at Target stores nationwide and on Target.com, helping more shoppers to adopt a sustainable lifestyle by providing greater access to healthier products to consumers across the country, while quickly becoming the #1 repeat brand in the cleaning category.

In addition to its flagship brand, Grove Co., Grove has built and launched several sustainable brands in the personal care, paper, and beauty categories such as the 100% plastic-free bar format body, hair and deodorant brand, Peach not Plastic. Grove’s customers have avoided over 4.9 million pounds of plastic being used by choosing Grove Co. and Peach not Plastic’s plastic-free and plastic-reducing products.

Grove is leading the consumer products industry out of plastic. Already plastic neutral and CarbonNeutralⓇ certified, the Company aims to become 100% plastic free by 2025. Beyond Plastic is Grove’s comprehensive plan to address the plastic crisis and to help the Company meet its ambitious goal. Today Grove also has 100% carbon neutral shipping and facilities and is committed to NetZero carbon emissions by 2030.

Investment Highlights

Management Commentary

“In going public, we sought a partner that shares our passion for using business to answer the urgent environmental crisis, and that accelerates our vision to make consumer products a positive force in human and environmental health. In that spirit, we are thrilled to partner with mission-driven disruptors Sir Richard Branson and VGII as we embark on this next chapter. Together we will create new opportunities to revolutionize the CPG industry,” said Stuart Landesberg, Co-Founder and CEO of Grove. “The CPG category is ripe for disruption. As an industry, we can, should, and must be able to offer products that are high performing and good for the planet. Grove can be a driving force for change, through our ongoing product innovation, retail partnerships and our ambitious goal to become 100% plastic free by 2025.”

“I am inspired by Grove’s vision to transform the availability and quality of planet-first products” said Sir Richard Branson, Virgin Group Founder. “Grove is paving the way for people to have more access to healthy, sustainable goods for their homes and I am excited to see the company’s impact on customers’ health and wellbeing. There are huge growth opportunities ahead, and we are delighted to work alongside Stu and his team as Grove continues to disrupt the industry and make a positive difference to people and the planet.”

Evan Lovell, Chief Investment Officer of Virgin Group, said, “Grove has a distinctive opportunity to capitalize on a growing sustainable products market ripe for disruption. Virgin Group sought to partner with an exceptional consumer products company, and our mission and platform offered the perfect opportunity for two incredible teams to come together. We are thrilled to partner with Grove and their team and look forward to our collective future success as a publicly traded business.”

Transaction Overview

The business combination includes an implied combined company pro forma enterprise valuation for Grove of $1.5 billion. The transaction will provide up to $435 million in net proceeds to the Company, including an $87 million fully committed common stock PIPE at $10.00 per share from an affiliate of the sponsor of VGII and new and existing Grove investors, including Lone Pine Capital, Sculptor Capital Management, General Atlantic and Paul Polman, and $348 million in proceeds from VGII’s trust account net of estimated transaction expenses (and subject to reduction based upon the exercise of any redemption rights by VGII’s public shareholders in connection with the transaction).

The Boards of Directors of Grove and VGII have both approved the transaction. The transaction will require the approval of the shareholders of both Grove and VGII, and is subject to other customary closing conditions, including the receipt of certain regulatory approvals. The transaction is expected to close in late Q1 or early Q2 2022. 100% of Grove’s shareholders will roll their equity holdings into the new public company.

Grove expects to use the proceeds from the transaction for working capital and general corporate purposes, in addition to covering transaction-related costs.

Upon the closing of the transaction, and assuming none of VGII’s public shareholders elect to redeem their shares, existing Grove shareholders are expected to own 72% of the combined company, VGII’s sponsor is expected to own 3% of the combined company, the PIPE investors are expected to own 4% of the combined company, and public stockholders are expected to own 21% of the combined company. Additionally, VGII will nominate an appointee to the Grove board once the transaction closes.

Additional information about the proposed transaction, including a copy of the merger agreement and investor presentation, will be provided in a Current Report on Form 8-K to be filed by VGII with the Securities and Exchange Commission (“SEC”) and will be available on the Grove’s Investor Relations page at investors.grove.co and at www.sec.gov.

Advisors

Morgan Stanley & Co. LLC is acting as exclusive financial advisor to Grove, and Credit Suisse Securities (USA) LLC is acting as financial advisor and capital markets advisor to VGII. Sidley Austin LLP is acting as the legal advisor to Grove, and Davis Polk & Wardwell LLP is acting as the legal advisor to VGII. Credit Suisse Securities (USA) LLC and Morgan Stanley & Co. LLC are serving as co-placement agents to VGII with respect to the portion of the PIPE financing raised from qualified institutional buyers and institutional accredited investors. Credit Suisse Securities (USA) LLC and Morgan Stanley & Co. LLC are not acting as agents or participating in any role with respect to, and will not earn any fees from, the portion of the PIPE financing raised from individual investors. Credit Suisse Securities (USA) LLC previously acted as sole book-running manager for VGII’s IPO.

Additional Information About the Transaction

A recording of the PIPE presentation will be posted on Grove’s Investor Relations website at investors.grove.co.

About Grove Collaborative

Launched in 2016 as a Certified B Corp, Grove Collaborative is transforming consumer products into a positive force for human and environmental good. Grove creates and curates high-performing, planet-first products across household cleaning, personal care, laundry, clean beauty, and pet, serving millions of households across the U.S. With a flexible monthly delivery model and access to knowledgeable Grove Guides, Grove makes it easy for people to build sustainable routines. Every item Grove offers, from both brands they craft — like their flagship brand Grove Co., plastic-free, vegan personal care line Peach not Plastic, and clean skincare brand Superbloom — and from exceptional third-party brands, has been thoroughly vetted against strict standards for clean ingredients, efficacy, sustainability, cruelty-free formulas, and ethical supply chain practices. Grove Collaborative, a public benefit corporation, is on a mission to move Beyond Plastic and recently entered physical retail for the first time at Target stores nationwide. Grove is the first plastic neutral retailer in the world and is committed to being 100% plastic-free by 2025. For more information, visit grove.com.

About Virgin Group Acquisition Corp. II

Virgin Group Acquisition Corp. II was formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. Sir Richard Branson, is the Founder of the Company, Founder of the Virgin Group and a renowned global entrepreneur; Josh Bayliss, the Company's Chief Executive Officer and director, who is the Chief Executive Officer of the Virgin Group and is responsible for the Virgin Group's strategic development, licensing of the brand globally and management of direct investments on behalf of the Virgin Group in various companies around the world; and Evan Lovell, the Company's Chief Financial Officer and director, who is the Chief Investment Officer of the Virgin Group and is responsible for managing the Virgin Group's investment team and portfolio in North America.