As the cannabidiol (CBD) food and beverage market continues to grow, more companies are taking advantage of this new and quickly developing space.
HeavenlyRx is looking to establish itself as a leader in CBD-infused beverages.
In July, the CBD wellness company announced an investment into Seattle-based craft soda maker Jones Soda (OTCQB:JSDA), acquiring 15 million common shares, which is about 25 percent of the company’s total issued and outstanding common shares.
With the investment, HeavenlyRx plans to develop a Jones Soda-branded sub-line of CBD-infused drinks.
HeavenlyRx CEO Paul Norman told the Investing News Network (INN) that the company is going to use its expertise in hemp and CBD to reinvigorate the Jones Soda brand.
“Jones is a brand … I think where the equity punches well above the weight of the brand relative to its sales,” said Norman.
He added that while Jones Soda is well known in the US, “it’s probably not selling as much as it could and that’s due to lack of investments in the core.
“Job one is to … bring some new energy to the core, rebellious Jones brand that everybody knows,” he continued. “Job two is to bring a twist to the brand by making a range of CBD-infused products.”
HeavenlyRX is an investee subsidiary under SOL Global (CSE:SOL,OTC Pink:SOLCF), an international investment company with a focus on the legal cannabis industry in the US.
On July 29, SOL Global announced the purchase of an additional 16 million common shares of HeavenlyRx valued at almost C$24 million, following an initial purchase of 37 million shares earlier in July totaling over C$15 million.
HeavenlyRx has a focus on hemp cultivation, processing and manufacturing CBD products, including tinctures, oils, topicals and vape-ready products — all markets that Norman said are expected to grow exponentially. He thinks, however, that the nascent CBD-infused food and beverage industries are going to expand just as quickly.
Norman told INN he believes that as more people integrate CBD products into their daily routines, the market for the extract is “ripe to be a very big market from a consumer-branded point of view.”
He was only recently chosen to lead HeavenlyRx in June after more than 30 years as the president of global food juggernaut Kellogg North America. With the investment, Norman is also going to be placed on Jones Soda’s board of directors once the initial share purchase closes.
Norman called Jones Soda “inherently inventive” and said its reputation as a niche craft pop maker is one of the attributes that inspired the investment. He added that its history in the pop market, its unique aesthetic and its national presence set it apart from other smaller soda makers that are more regional.
The Jones Soda buy in isn’t the only big move on the part of the CBD company as of late.
In June, HeavenlyRx announced that it had closed on 51 percent of a controlling equity state in Tru Brands, a plant-based nutrition company.
“The combination of the growing consumer demand for plant-based solutions with CBD wellness make TRU Brands’ current offering … and their pipeline of innovation a perfect fit for HeavenlyRx,” said Norman in a press release.
HeavenlyRX also entered a US$10 million agreement to acquire Airganics, a company focused on developing wellness products, last month. Airganics comes with three established brands with personal aromatherapy diffusers, CBD supplements and nutrient inhalers. The company’s line of products is “uniquely poised to capture the rapidly expanding CBD wellness audience,” according to a press release.
Norman said that the company’s recent activity has been an effort to create a portfolio of “distinct” brands “from seed to shelf that combines the best-in-class farming technology and (CBD) isolates with branded innovation.”
The next month will also prove to be busy for the company. SOL Globals’s year-end financial report, released on July 29, notes that HeavenlyRx is looking to go public and has started negotiations and due diligence for a US listing. Norman didn’t go into detail about the process, but said information about the listing is set to come out later this month.
“The desire is there and there’s a lot of effort going into the process of taking the company public as soon as we can and as soon as it makes sense,” said Norman.
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Securities Disclosure: I, Danielle Edwards, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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