BOULDER — Charlotte’s Web Holdings Inc. (OTC:CWBHF), a local CBD product manufacturer, announced Monday the acquisition of Canadian hemp topicals maker Abacus Health Products Inc (CSE:ABCS).
The total value of the deal is more than $68 million.
“For Charlotte’s Web the combination benefits from the current U.S. regulatory environment which favors topical- CBD products within the food/drug/mass channel,” according to a Charlotte’s Web news release. “For Abacus, the acquisition provides the advantages of joining an established and industry leading platform and benefiting from leading CPG management and brand equity with a low-cost vertical supply chain …”
Combined, the two firms accounted for $29.1 million in sales during the third quarter of 2019.
“The complementary strengths of our relative market positions made this merger a logical strategic move,” Charlotte’s Web CEO Deanie Elsner said in a prepared statement. “With this acquisition we strengthen the business to reflect the evolution of the category. Because most of Abacus’s products are positioned in adjacent categories, our combined distribution reach has limited shelf overlap. Together we are the most developed CBD company across every channel and segment and positioned to accelerate our growth and extend our market share. Furthermore, it enables us to drive more scale production through our vertically integrated infrastructure.”
The acquisition is expected to be finalized in the second quarter of 2020.
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