Marley Beverage sells assets to American outfit
New Age Beverage, based in the United States, announced that it acquired the assets of Marley Beverage Company, a fast-growing brand on a path to hit US$15 million in annual sales.
The sale shows the continued strength of the Marley name nearly 40 years after the reggae icon's passing.
Created in partnership with Bob Marley's family, Marley Beverage Company makes two lines of ready-to-drink beverages - iced teas called Mellow Mood and iced coffees called One Drop. The products contain the image of Marley. The purchase price for the beverage company's assets wasn't immediately disclosed due the private nature of Marley Beverage, which is led by Harry Bigelow.
The deal, announced on March 31, will see all of the operating assets of Marley Beverage Company LLC transferred to New Age via the sale of 2.85 million shares at an undisclosed price, plus a cash amount equal to 150,000 times the average closing price of New Age - The American company currently trades at roughly US$4.23 - which amounts to an estimated US$634,000.
Additionally, New Age will pay US$1.25 million above its purchase price provided Marley Beverage hits annual sales target of US$15 million. The deal is set to close in June.
Marley Beverage is engaged in the development, manufacturing, selling and marketing of nonalcoholic relaxation teas and sparkling waters, and coffee drinks.
In October of 2016, New Age entered into a management agreement, which resulted in the company taking over the sales, marketing and distribution of the Marley Beverage Company. At the time, both companies continued to be separate entities operationally and financially.
"The addition to the portfolio enables us to increase our relevance with key retailer and distributor partners with a broader portfolio of offerings, and enables the Marley Beverage Company to leverage our infrastructure, sales force and scale," said New Age in a release to shareholders.
New Age describes itself as an in-house sales and merchandising team consisting of approximately 50 individuals throughout the United States. It made US$25.3 million in annual revenues, but recorded a US$3.6 million net loss for year ending December 2016. Its annual sales are significantly up above the US$1.8 million earned in 2015 due to its acquisition of a much larger company in June 2016.
Marley Beverage products are sold in the US, but also have a strong sales presence in Chile, Bermuda, Puerto Rico and the United Kingdom.