Australia markets open in 36 minutes

    -29.60 (-0.39%)

    -0.0023 (-0.32%)
  • ASX 200

    -20.10 (-0.28%)
  • OIL

    -0.47 (-0.71%)
  • GOLD

    +7.90 (+0.45%)

    -1,229.47 (-1.52%)
  • CMC Crypto 200

    -26.37 (-1.79%)

FijiKava Ltd (FIJ.AX) Signs LOI to Buy Danodan CBD Tincture Business in USA and Reposition American Business as the Calmer Co.

  • Oops!
    Something went wrong.
    Please try again later.
·6-min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
FijiKava Ltd (ASX:FIJ)
FijiKava Ltd (ASX:FIJ)

FijiKava Ltd (FIJ.AX) Signs LOI to Buy Danodan CBD Tincture Business in USA and Reposition American Business as the Calmer Co.

Brisbane, Australia, Nov 5, 2021 - (ABN Newswire) - FijiKava Ltd (ASX:FIJ), an Australian-Fijian medicinal kava company which produces natural products to reduce anxiety, promote relaxation and improve sleep and sports recovery, today announced signing of indicative letters of intent for FijiKava's wholly owned subsidiary, Fiji Kava Inc, USA to acquire the assets of The Whole Plant Company, trading as Danodan Hempworks USA (Danodan) from WPC Inc, and cannabidiol (CBD) extraction US Patent 10,716,819 from WPC Inc Founder, Mr Daniel Stoops (together, the Acquisition).

- FijiKava Inc. USA will acquire Danodan's Portland Oregon based CBD Tincture Plant, Inventory and all associated intellectual property, CBD extract US Patent 10,716,819

- FijiKava's US subsidiary. FijiKava Inc (USA) will begin doing business as The Calmer Co. USA and the existing Danodan team will join The Calmer Co. from January 1st 2022

- Global CBD market valued at USD 2.8 billion in 2020 and is expected to grow at a compound annual growth rate (CAGR) of 21.2% through to 2028

Danodan produces a suite of organic certified CBD tincture products sold throughout wellness boutiques and regional natural foods grocery stores in the USA. On completion of the transaction, FijiKava will explore using Danodan's patented extraction process for Noble Kava products.

FijiKava sales in the USA to date have been exclusively via Amazon online or as B2B sales of ingredients. This acquisition will see the company take first steps to actively operate a business unit in the USA first with the Danodan branded products and then with the FijiKava branded products soon to follow. To reflect their expanded product lines and plans for further acquisitions of aligned brands and products, it is intended that FijiKava Inc. (USA) will commence doing business as The Calmer Co. (USA) from 1st January 2022.

The Company considers the Acquisition to be a reflection of FijiKava's previously stated intention to expand product lines and plans for further acquisitions of aligned brands and other health and wellness products meeting similar needs to that of Noble Fijian Kava in the health and wellness, functional beverage, cosmeceutical and nutraceutical space. Daniel Stoops, Founder of Danodan said "We're really excited about this opportunity. We've been looking for a new relationship like this. We're aligned on values. We fit very nicely into The Calmer Co (USA)'s mission. Our products are all about reducing anxiety, relaxation, and better sleep. With the combination of investment and sales and marketing expertise of the new team, the Danodan brand has a bright future"

Fiji Kava CEO, Anthony Noble said: "As FijiKava Inc (USA) commences US operations, next year, as The Calmer Co. (USA) we will be gathering, a group of likeminded brands and companies, focussed on delivering customers the world's leading suite of products to reduce anxiety, promote relaxation, improve sleep and support sports recovery and performance. Danodan's organic certified CBD tinctures are renowned in the USA for purity and quality and represent an integrative, broad-spectrum approach to herbal formulation, with a real point of difference from highly processed CBD products. The global CBD market exceeds US$2.8bn1 and leading the way is the US market, which is becoming increasingly mainstream. Recent progress such as California Assembly Bill 45 demonstrate this.

"Despite the challenges in 2021 during the Covid-19 Pandemic and working capital constraints, we are confident that under our management we can grow Danodan revenue strongly in 2022. Growing availability of the Danodan products in retail and online will be a key initial driver of growth for the Danodan products, as it has been for FijiKava products.

"We will soon begin to work on determining if Danodan's patented technology can be applied to Noble Fijian Kava. The liquid dispersible beverage ready format of these tinctures is highly aligned with our growing innovation and product development pipeline; including the exploration of kava and CBD combination products."

The Letters of Intent signed are indicative and non-binding and the Acquisition is proposed to be subject to the following conditions precedent:

- completion of financial, accounting, business, tax and legal/regulatory confirmatory due diligence by FijiKava on Danodan;

- approval of the directors of FijiKava to proceed with the Acquisition;

- negotiation and execution by the parties of definitive sale and purchase agreements;

- receipt of all necessary approvals from appropriate government agencies and authorities and major customer/supplier consents (if required due to a change of control of Danodan).

The conditions precedent must be satisfied by 24th December 2021.

The proposed consideration for the Acquisition is:

- In relation to the assets of Danodan: USD235,000 cash in consideration for the acquisition of the WPC Assets. This consideration assumes that, upon completion, WPC Inc would have an agreed level of inventory and working capital to operate the business in the normal course.

- In relation to the Patent: USD350,000 cash.

Total proposed consideration outlined in the two letters of intent totals USD585,000.

The Company has sufficient capital to fund the Acquisition using its current cash reserves, however the Company may undertake a capital raising under its current placement capacity or pursuant to a security purchase plan to raise funds that would be allocated towards the Acquisition as well as the Company's current activities.

The intended completion date for the Acquisition is 1st January 2022.

It is not proposed that any changes to the FijiKava Ltd Board of Directors or senior management team will result from the Acquisition.

About Fiji Kava Ltd:

FijiKava Ltd (ASX:FIJ), an Australian-Fijian medicinal kava health & wellness company, producing natural 'noble kava' products for the natural medicine market, estimated to exceed USD $210 billion by 2026 globally.

As the first foreign company with approval from the Fijian Government to operate in the kava industry. FijiKava has established a global leading sustainable and 100% traceable, certified organic supply chain of 'noble kava' including a nucleus farm in Levuka, on the island of Ovalau, Fiji.

FijiKava is focussed on expanding the availability of noble kava products throughout western markets to provide a natural alternative to prescription medicines to promote sleep, soothe and calm the nerves, support muscle relaxation and relax the mind.

Backed by years of independent research, Fiji Kava medical kava products are produced by high-quality GMP and are TGA and FDA compliant.


For Investors
Jay Stephenson

For Media
Anthony Noble

Fiji Kava Ltd

Copyright (C) 2021 ABN Newswire. All rights reserved.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting