Bevcanna Enterprises Inc. has entered into a share exchange agreement to acquire health and wellness nutraceutical product company Greenflame Distribution Ltd., an arm’s-length private British Columbia corporation. Greenflame’s proprietary product portfolio includes a diverse range of health and wellness nutraceutical products catering to metabolism (weight loss), energy, hydration, cognitive function, sleep support, heart health, mineral supplementation and other wellness-related products. Greenflame’s product portfolio is formulated and professionally crafted based on market demand and product quality. Every product manufactured is third party tested for purity and manufactured in GMP-certified (good manufacturing practices) facilities.
As Bevcanna already develops and manufactures a range of alkaline and mineralized beverages and supplements for both in-house brands and white-label clients, it is acquiring Greenflame to expand and diversify its existing product offering, manufacturing capabilities and distribution network. Bevcanna intends to utilize Greenflame’s GMP-certified manufacturing ties, supply chain control, extensive marketing resources, tech stack expertise, influencer network and consumer-friendly subscription packages to enhance growth opportunities. Following closing, the company aims to establish an agile, innovative and profitable direct-to-consumer (DTC) e-commerce division for Bevcanna’s new product categories. Bevcanna is looking to retain additional management expertise following closing to help manage e-commerce strategy and operations, including digital marketing, technology management, customer service, fulfilment, quality assurance and divisional finance.
Greenflame nutraceutical product portfolio
Metabolism and energy products:
- Metabolism Boost Plus with Methylene Blue — available in tablet and gummy variations for boosting metabolism and burning both sugars and fats in the body while activating ATP (adenosine triphosphate) to drive more oxygen into cells, resulting in improved brain function and energy production;
- Energy Juice — available in powder and stick packs, a bioactive formula extracting nutrients from bananas, oranges, grapefruits and lemons, delivering essential daily nutrients;
- Cardio Juice — available as powder and stick packs, a bioactive formula extracting nutrients from beets, boosting nitric oxide and enhancing cardiovascular function;
- Nutrient Juice — available in powder and stick packs, a bioactive formula harnessing plant-based nutrients, enhancing energy and mood while supporting the gut microbiome, providing daily body nourishment.
Hydration products:
- Clean Hydration Electrolyte Mix — available in powder and stick packs, containing essential electrolytes and minerals from the Great Salt Lake.
Cognitive and sleep support:
- Nootropic Energy Drink — a ready-to-drink cognitive energy booster featuring a proprietary blend of brain-enhancing mushrooms, clean-sourced caffeine and sweetened with manuka honey;
- Sleep Support — available as tablets and gummies in two separate formulas — one with melatonin and one without; Sleep Support includes a proprietary blend of magnesium, chamomile and other healthy sleep ingredients;
- Nootropic Mental Edge — capsules for daily focus and energy shots in pina colada flavour, featuring a proprietary blend of mushrooms and key vitamins to improve brain focus and enhance concentration.
Heart and health supplements:
- Nitric Oxide Heart Health — supports cardiovascular health;
- Electrolyte Gummies — watermelon-flavoured for electrolyte balance;
- Magnesium Gummies — for magnesium supplementation.
Specialty supplements:
- Colloidal Gold — anti-inflammatory, cognitive, joint health, mood enhancement, anti-aging, immune support and overall vitality benefits;
- Other wellness-related products.
Terms of the acquisition
Pursuant to the agreement, Bevcanna has agreed to issue 4,166,663 common shares in the capital of the company to the shareholders of Greenflame in exchange for all the issued and outstanding shares of Greenflame at a deemed price of 60 cents per consideration share for total deemed consideration of $2.5-million on the condition that Greenflame will be acquired on a debt-free basis. No finders’ fees are payable in connection with the acquisition. The acquisition is an arm’s-length transaction. The consideration shares to be issued in connection with the acquisition will be subject to a restricted period of four months and one day.
Closing of the acquisition is anticipated to be on or about Aug. 1, 2024, in accordance with the policies of the Canadian Securities Exchange.
The company initially considered acquiring a predecessor company of Greenflame in 2022 that held a portion of Greenflame’s existing product portfolio. However, the company terminated those negotiations when it became subject to an extended cease trade order. In connection with such prior negotiations, the company obtained an independent valuation report from an arm’s-length third party dated Aug. 3, 2022, which valued the predecessor’s proprietary product portfolio’s earnings history and concluded a fair market value of net assets between approximately $1.36-million and $1.53-million. Subsequent to the date of the report, Greenflame acquired the original product portfolio and integrated additional proprietary formulations, including the ingredient methylene blue, which purportedly boosts metabolism, burns sugars and fats, activates ATP to increase oxygen delivery to cells, and enhances brain function and energy production. As a result of the additional products, the company agreed to increase the purchase price to $2.5-million, payable in consideration shares.
