Tuesday, June 11, 2019

Geyser Brands Inc. (TSX.V: GYSR) Moves Forward with Acquisition of Hemp- and CBD-Based Pet and Consumer Health Care Brands

  • Geyser Brands is entering into a definitive agreement for the acquisition of Solace Management Group for an aggregate purchase amount of $3.9 million
  • The acquisition will enable Geyser to broaden the scope of its CBD- and hemp-based product range, helping solidify its position on the international market
  • Solace has an extensive portfolio of pet and consumer products, as well as licensing distribution and production arrangements
Consumer health care company Geyser Brands Inc. (TSX.V: GYSR) recently announced its entry into a definitive agreement for the acquisition of Solace Management Group Inc., a private corporation existing under the laws of British Columbia.
The acquisition is strategic for Geyser Brands, company CEO Andreas Thatcher said in a news release (http://nnw.fm/h3VKn). It is expected to establish Geyser as a leading provider of health-focused CBD and hemp products. Established brand companies like Solace have developed deep connections with their customers, Thatcher concluded, providing Geyser with an opportunity through its cannabis licensed producer to extend that conversation into CBD.
Solace has well-established brands already operating in the cannabis space. The company has gained significant market share through proprietary formulations and distribution and production arrangements.
One of the company’s most prominent brands is all-natural hemp-based pet treats line Apawthecary Pets. The products are available in pet and veterinary stores across Canada. Solace’s portfolio also features 23 products and 57 SKUs of both pet and consumer health care formulations. All of the products are made from organic, cold-pressed hemp seed oil.
The company has a steady expansion strategy in place. Recently, Solace moved to a new 7,500 sq. ft GMP-compliant facility that significantly increased its production capacity.
Even more significant, however, is the company’s more than C$2 million in 2018 revenues, with net margins of 30 percent. This shows an unusual level of product development and market acceptance.
As per the new definitive agreement with Geyser Brands, Solace will be terminating its licensing agreement with the company’s current Canadian manufacturer. Manufacturing and distribution will both become internal processes for the purpose of revenue maximization. The Solace licensing agreement with the company’s U.S. manufacturer is on hold. The manufacturer has to obtain all required regulatory approvals and licenses to comply with applicable laws.
The terms of the agreement between the two entities state that Geyser Brands will acquire all of the issued and outstanding shares of Solace for an aggregate purchase amount of $3.9 million. Closing of the proposed transaction remains subject to Geyser’s satisfaction of the Solace due diligence review, the receipt of necessary (third-party) consent, board approvals, shareholder approval, TSX Venture Exchange approval, satisfaction of exchange requirements, etc.
Geyser Brands is a health care company with a focus on Hemp CBD-based consumer products. Through its Health Canada-approved licensed producer in Vancouver, British Columbia, it is building a regulatory platform for the manufacture and distribution of cannabis products in Canada, and it is anticipating its processing and sales licenses.
These will be become the channel though which brands can reach consumers in the regulated space. The company plans to roll out this business model globally, where CBD regulations allow, particularly in Asia and Europe.
Investment in product innovation includes the company’s proprietary nanotechnology, NanoFusion, which delivers topical, cream, food, beverage, oil, tincture and baked good formulations with superior bio availability, water solubility and dosage control.
For more information, visit the company’s website at www.GeyserBrands.com
NOTE TO INVESTORS: The latest news and updates relating to GYSR are available in the company’s newsroom at http://nnw.fm/GYSR
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