A Denver company that makes CBD beverages has agreed to acquire a Utah beverage company to increase its distribution might, especially in Asia.
New Age Beverages Corp. (Nasdaq: NBEV) announced Monday that it will acquire privately held Morinda Holdings of Provo, Utah, for $85 million.
Here’s what you need to know:
- New Age will pay $75 million in cash and $10 million in New Age stock.
- Morinda focuses on direct-to-consumer and online sales, with 70% of its business generated in Japan, China, Korea, Taiwan and Indonesia.
- Both companies also make and distribute non-CBD beverages, including kombucha and tea.
- The deal is expected to close in December.
New Age CFO Gregory Gould told Hemp Industry Daily that his company isn’t yet certain it will distribute its CBD line of beverages outside the U.S., but the deal will provide the infrastructure that would allow it to do so.
Like many CBD manufacturers, New Age is waiting for Congress to remove hemp-derived CBD from the Controlled Substances Act, which could happen by year’s end if lawmakers agree to a new Farm Bill.
Gould said the acquisition will go through even if New Age’s CBD beverages remain only in Colorado.
“Combined we’ll have more scale, which helps a lot in the beverage business,” Gould said.