DENVER, CO, U.S. – New Age Beverages Corporation, the Colorado-based Company that markets the brands XingTea, XingEnergy, Aspen Pure PH and Aspen Pure Probiotic Water, Búcha Live Kombucha, Marley One Drop Coffee, and Marley Mellow Mood Relaxation Drinks, has announced the signing of a definitive agreement to acquire the assets of Marley Beverage Company, LLC, including the Marley brands in ready-to-drink coffee and relaxation drinks and teas.
The line complements the existing New Age Healthy functional beverage line and fills an important role in the Company’s portfolio.
New Age Beverages Corporation successfully completed a $17.5 million financing and up-listing to the NASDAQ Capital Market Exchange in February.
One of the major drivers of growth that the company shared with investors was the potential addition of new brands/companies to act as an accelerant and solidify the Company’s position as a leader in healthy functional beverages.
The acquisition of the assets of the Marley Beverage Company is a reflection of that strategy taking hold, provides a tremendous value-creation and instantly accretive opportunity for shareholders, and brings a globally recognized brand into the New Age Brand Portfolio.
The Transaction
The transaction consideration consists of 2.85 million shares of common stock plus a potential earn out based on performance in return for substantially all of the assets of Marley Beverage Company, LLC.
The Marley Beverage Company paid $1.0 million in management fees to the Company under the terms of the management agreement. Including all consideration, the final transaction implies a multiple of less than 1 times trailing twelve-month revenue. The closing of the transaction is subject to certain closing conditions.
New Age entered into a management agreement on October 24, 2016 to integrate the sales, marketing and distribution of the Marley Beverage Company into New Age.
Since that time, the commercial organizations have been operating as one gaining important leverage and increased scale and relevance with major retailers and distributors. Upon completion of the transaction, substantially all of the assets of the Marley Beverage Company will be integrated into New Age.
Gary Shiffman, one of the principals of Marley Beverage Company commented, “We are very pleased to be partnering with New Age and confident that the Marley brand is in good hands.
Our management agreement over the past six months gave both companies a real-time, real-world opportunity to diligence each other, and New Age’s leadership team and commercialization capabilities proved to be exceptional.
In excess of $35 million has been invested in building the awareness and loyalty of the Marley brand in beverages, and we are confident the brand will capitalize on that investment under the leadership of the New Age Beverages Corporation.”
The Company
With the addition of the brands Marley Beverage Company, New Age will now compete in the following growth segments with organic or all natural, no preservative, no high fructose corn syrup, no GMOs healthier beverages including:
As part of the combination, the team has identified more than $5.5 Million in cost and revenue synergies to be gained over the next 12 months.
A convergence committee has been established that has already begun work on identified areas of savings and growth. In the cost synergy area, the group will realize more than $3 million in immediate savings in operating expenses and infrastructure convergence.
In revenue synergies, the group has already integrated the Marley Beverage Company portfolio into its existing operations and sales force, major DSD distribution partners, and New Age’s national major food, drug, mass, and convenience retail customers.
The group has also been expanding Marley One Drop® and Marley Mellow Mood® into New Age’s owned-DSD distribution system that captively covers more than 5,000 outlets.
Brent Willis, Chief Executive Officer for New Age Beverages commented, “We are really excited about the addition of the Marley brand and know its potential is virtually untapped.
Fully integrating their company into the New Age infrastructure instantly makes the Marley brands profitable, and significantly improves the gross margin mix of New Age.
We are building a great portfolio of differentiated brands all competing in the growth segments of beverages, and are confident that the Marley family of brands will be a fantastic addition.”
