The Green Organic Dutchman Holdings Ltd. (TSX:TGOD), one of the Canadian marijuana stocks, has invested in the U.S. CBD beverage space
SmallCapPower | May 10, 2019: The Green Organic Dutchman Holdings Ltd. (TSX:TGOD), one of the Canadian cannabis stocks, Wednesday announced that it has made a strategic investment into the U.S. beverage space as a co-founding investor and strategic partner in the newly-formed Califormulations LLC. Based out of Columbus, Georgia, Califormulations will serve global branded companies with concept-to-shelf beverage commercialization support, including formulation development, technical services, in-house pilot scale production and contract manufacturing co-ordination.
Symerise Inc. (inclusive of its Beverage Innovation Centers in Laguna Beach and Teterboro) and TGOD have made co-founding investments in Califormulations. The investments are a combination of equity and debt financing. Green Organic Dutchman plans to work with Califormulations to expedite the U.S. launch of TGOD branded organic hemp-based CBD beverages, as local laws and regulations permit.
Green Organic Dutchman CEO Brian Athaide said, “We are incredibly excited to partner with Califormulations to further our development of hemp-based CBD beverage products. With the U.S. market for functional beverages, including wellness, energy and sport recovery, currently worth over US$20 billion, we want to remain on the cutting edge of innovation and establish the foundation for future proprietary and novel TGOD-branded products. TGOD strives to partner with established industry leaders, and we believe that this forward-looking strategic partnership positions TGOD to capitalize on the future cannabinoid beverage market.”
The investment in Califormulations shows TGOD’s commitment toward brand differentiation. When permitted, Califormualtions will be an important enabler, allowing Green Organic Dutchman to manage supply chains without excessive investment retail store formats (bricks and mortar). This would enable TGOD to focus on capital investments while building the world’s leading organic cannabis brand.
Green Organic Dutchman plans to leverage Califormulations to accelerate the U.S. launch of TGOD-branded organic hemp-based CBD beverages, as laws and regulations permit. Initially, the Company will focus on having bulk non-infused beverage concentrates produced and shipped by Califormulations to TGOD-owned and contracted manufacturing sites around the globe, including Canada, for infusion with cannabinoids and distribution within legal markets.
Califormulations is a key component to TGOD’s existing global organic cannabinoid-infused beverage strategy. Green Organic Dutchman Holdings’ beverage team will have access to, and use of, Califormulations’ R&D facilities to collaborate on hemp-derived CBD beverage developments, while maintaining and enhancing TGOD’s intellectual property portfolio. Green Organic Dutchman will enjoy certain exclusivities pertaining to the development of organic cannabinoid-infused beverages through the Califormulations platform.
The Green Organic Dutchman Holdings stock currently trades at a market capitalization of C$1.2 billion with a price-to-book multiple of 2.8x.