08:42:47 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Arev Brands International Ltd
Symbol AREV
Shares Issued 45,834,209
Close 2019-01-16 C$ 0.32
Market Cap C$ 14,666,947
Recent Sedar Documents

Arev Brands to acquire Canna Gold assets for $1.2M

2019-01-17 10:15 ET - News Release

Mr. Mike Withrow reports

AREV ANNOUNCES PURCHASE AGREEMENT TO ACQUIRE CANNA GOLD ASSETS

Arev Brands International Ltd. has signed a purchase and sale agreement dated Jan. 16, 2019, with Jeff Mischuda to acquire a 100-per-cent interest in certain assets of Canna Gold Inc. The purchase price of $1.2 million is payable by way of the issuance to Mr. Mischuda of four million common shares of the company at a deemed price of 30 cents per share. The assets comprise the Canna Gold brand; assembly and production methods for Canna Gold's products; Canna Gold products -- vaporizers and tinctures (all products); all Web and trade dress and packaging; and all marketing and selling method, styles, designs and practices. The business involving these assets and products will be deployed in jurisdictions where such business is legal such as in certain states of the United States. When gross sales revenues of the retail inventory of the assets reach a minimum of $1-million as reported in the interim or year-end financial statements of the issuer, the issuer will pay to Mr. Mischuda the lesser in value of one million common shares at the closing market price on the date of SEDAR filing of the issuer's financial statements with the securities commissions or that number of common shares having an aggregate deemed value of $500,000.

Consumer spending on cannabis concentrates in the United States was projected to reach almost $3-billion in 2018, according to a report by Arcview Market Research in partnership with BDS Analytics. That's an increase of 49 per cent over the previous year's sales. The only larger marijuana product category is smokable flower. According to Arcview, by 2022, U.S. concentrate product sales are estimated to hit $8.4-billion and nearly match the $8.5-billion in flower sales forecast for that year.

Vaping is the main driver of concentrate sales and 58 per cent of concentrate spending in 2018 will come from prefilled vaporizers. Linda Gilbert, BDS Analytics' managing director of consumer insights, says the two main reasons vaping is popular is that it is discreet and portable. Vaping emits less odour than bongs or marijuana cigarettes.

This acquisition provides another high-demand, high-margin product line. The company can leverage its existing assets into additional products such as exclusive extracts from the most popular strains made from its extraction systems. Having this vertical integration gives the company control over the quality and safety of their ingredients and the ability to stay ahead of competitors by being able to produce and deliver innovative new proprietary products with attractive margins.

Mike Withrow, chief executive officer and a director, commented: "This acquisition of assets brings another great branded line of products to Arev. We can now enter into distribution and licensing agreements in Canada and U.S. legal markets where we can leverage the B.C. Bud Depot customer base of 50,000 patients and adult users and marketing in High Times' coveted inside cover spread." Mr. Withrow went on to say: "We now have a complete portfolio from rare and original genetics and seeds to high-quality extracts and concentrates for use in our exclusive branded finished products, which include: (1) Bare medicinal topicals for burns, severe insect bites, pain and scaring; (2) tinctures; (3) vape pens and flavoured extract profiles; and (4) distillates, isolates and other concentrates. This is a fantastic acquisition for our shareholders as it adds another award-winning line to the company's product portfolio."

Jeff Michuda, founder and creator of Canna Gold, commented: "I'm pleased to be bringing the Canna Gold line of products to Arev and joining the team. I'm confident our award-winning products bring great value to Arev."

About Arev Brands International Ltd.

Arev Brands produces and delivers functional compounds and ingredients from its world-class extraction systems. Arev is revolutionizing the current delivery method of terpenes, cannabinoids and flavonoids. These premium ingredients and formulations are used in products targeted for sale in the natural health, medical, functional food, nutraceutical, sport nutrition and bioceutical markets. Arev innovates through extraction to produce extracts from specific selected plant and exude from trees that address five areas of health, including anxiety, pain management, insomnia, central nervous system disorders and libido.

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