New Age Beverages Corporation (Nasdaq: NBEV), the
omni-channel Colorado-based healthy and organic products company,
today announced that it has entered into a definitive agreement to
acquire ARIIX, together with four additional companies in the
e-commerce and direct selling channels. The combination will create
a global firm with estimated pro forma revenues in excess of $500
million across more than 75 countries worldwide.
NewAge and ARIIX have agreed to create a leading
health and wellness firm, with a unique omni-channel route to
market, depth in the e-commerce and direct selling channels, a team
of more than 400,000 independent representatives, and a portfolio
of healthy products unrivaled in the industry. Merging into the
combined company are:
NewAge - |
One of the fastest-growing beverage companies worldwide with
penetration in over 60 countries and a unique omni-channel route to
market |
ARIIX
- |
One of
the fastest-growing direct selling companies with over 17% CAGR
2015-2019, penetration in over 35 countries, and a leading
nutritional performance portfolio |
Zennoa
- |
Established in 2016 with its largest presence in Japan and a
portfolio of superfood-based dietary supplements, beverages and
fermented foods |
LIMU
- |
Global
leader in fucoidan-rich, seaweed-based nutritional products and
beverages with over 2,000 independent research studies on its
proprietary supernutrient |
MaVie
- |
DNA
mapping and wellness company with predictive genomic sequencing and
a range of nutritional products customized to individuals’ DNA
makeup |
Shannen
- |
Award-winning Indonesian skincare and beauty company founded in
2018 with sales of over $25 million in its first two years of
operations |
Brent Willis, Chief Executive Officer of NewAge,
who will be the CEO of the newly combined company, said, “We are
very excited that these companies are coming together to create a
powerful global enterprise with tremendous growth potential. We
will have the team, the scale, the profitability, the brands, and
the reach to drive superior growth and return for shareholders and
all of our valued independent representatives and consultants
worldwide. We believe we are well positioned in this new business
environment with more than 80% of products ordered and fulfilled
online and delivered direct to consumers’ homes across now more
than 75 countries, and expect to continue to be a disruptive force
creating the first omni-channel company in the industry.”
Key Highlights
- Increases scale with expected pro forma revenue in excess of
$500 million, with increased free cash flow and positive net
income
- Enhances the combined company’s global footprint, adds to the
core markets of China, Japan and Europe, and expands market access
to over 75 markets worldwide
- Furthers the omni-channel route-to-market strategy with over
80% of products ordered and fulfilled online and over 80% delivered
direct to consumers’ homes
- Strengthens portfolio of healthy brands with major new
additions to category platforms of Health and Wellness, Healthy
Appearance and Nutritional Performance
ARIIX is one of the fastest-growing companies in
the direct selling industry with more than 17% compound annual
revenue growth over the past five years. ARIIX was created to
be a disruptive force in the e-commerce and direct selling
channels. The company was founded nine years ago by former USANA
senior executives, led by Dr. Fred Cooper and Mark Wilson. ARIIX
has garnered over 200 awards in business, leadership, branding and
other areas alongside many Fortune 500 companies to grow to more
than $200 million in revenue and $15 million in EBITDA in
2019.
Dr. Fred Cooper, Chief Executive Officer of
ARIIX, who will be joining the Board of NewAge as part of the
merger, commented, “We have successfully disrupted this industry to
create tremendous opportunity for all of our independent
representatives over the last nine years. Now we are further poised
to springboard to the next level together with NewAge. We are in an
excellent position to accelerate organic growth with our direct
business model, our expanding market access, and our healthy
product portfolio, and are confident as a result of this merger, we
will further disrupt the industry and create the first omni-channel
company in the sector.”
Consideration for the acquisition will consist
of a combination of cash, common stock and convertible notes. At
closing, NewAge will pay $25 million in cash and will issue 18
million shares of the Company’s common stock. NewAge will also
issue a convertible note for $10 million that matures six months
from closing and a convertible note for $141.25 million that
matures 24 months from closing. Details of the transaction are
included in the Company’s Current Report on Form 8-K dated July 20,
2020. Closing of the transaction is expected to occur in the third
quarter of 2020.
Similar to ARIIX, NewAge has also been a
disruptor, growing from $2 million to over $250 million by the end
of 2019 in less than 4 years since inception. NewAge has developed
a platform of healthy functional brands sold through its
omni-channel route to market across more than 60 countries around
the world. The combined entity expects to reach pro forma revenues
of over $500 million, with a blended gross margin of approximately
70%, and adjusted EBITDA of more than $30 million for
2020.
As part of the combination, NewAge expects to
capture approximately $20 million in EBITDA in the first 18 months
following closing in cost and revenue synergies in the areas of
cost of goods sold, manufacturing efficiencies and scale,
operational redundancy, cross-pollination of brands, as well as
market and channel expansion.
Brent Willis concluded, “NewAge was created to
make a difference for consumers with healthy alternatives. ARIIX
and all of the other new partners embody the same culture to
unleash human potential to do well by doing good. Staying true to
our purpose and ideals has served us all well, and now we will be
able to increase our reach and impact even more to inspire and
educate the planet to Live Healthy.”
Conference Call
The Company will host a live conference call and
webcast tomorrow, July 21, 2020 at 8:30 a.m. Eastern Time.
Conference call details are provided below. Interested investors
can dial into the conference call to hear the details of this
merger and participate in a question and answer session.
Date: Tuesday, July 21,
2020Time: 8:30 a.m. Eastern Time Toll-free
dial-in number: 1-877-407-3982International
dial-in number: 1-201-493-6780Conference
ID: 13706830
The conference call will also be broadcast live
and available for replay here and via the investors section of the
Company’s website at
https://newagebev.com/en-us/our-story/investors. The webcast replay
will be available for approximately 45 days following the call.
Please dial into the conference call 15 minutes
before the start time due to increased demand for conference calls.
You will be asked to register your name and organization.
A replay of the conference call will be
available after 11:00 a.m. Eastern Time on the same day through
Tuesday, July 28, 2020.
Toll-free replay number:
1-844-512-2921International replay number:
1-412-317-6671Replay ID: 13706830
About NewAge NewAge is a
Colorado-based organic and healthy products company dedicated to
inspiring and educating consumers to “Live Healthy.” The Company is
the only omni-channel company with access to traditional retail,
e-commerce, direct-to-consumer, and other channels across more than
60 countries worldwide, with a network of over 250,000 exclusive
independent product consultants around the globe. NewAge markets a
portfolio of better-for-you products including the brands Tahitian
Noni, TeMana, Nestea, Volvic, Illy Coffee, Evian, Búcha Live
Kombucha, ‘Nhanced and others. The company operates the websites
newage.com, noninewage.com, and a number of other individual brand
websites.
About ARIIX ARIIX is a
Utah-based e-commerce and direct-to-consumer company with a network
of more than 130,000 independent representatives. The ARIIX
opportunity and brands are available in over 35 countries around
the world. Founded in 2011, ARIIX has been one of the most
disruptive and fastest-growing companies in the industry and
reached No. 35 on the DSN Global 100 in 2020, up from No. 57 in
2019. The company has earned over 200 awards for its business
practices and was recognized as one of the fastest-growing private
companies in America. The company operates the website
ariix.com.
About ZENNOA Zennoa is an
e-commerce and direct selling company founded in 2016 with its
largest operations in Japan. "Zennoa" means "freedom, balance and
peace," and sells a portfolio of superfood-based dietary
supplements, beverages and fermented foods. Zennoa was created by
John Wadsworth and Kim Asay, also two of the original founders of
Morinda (Noni by NewAge). Mr. Wadsworth is credited with building
Tahitian Noni Juice into the original superfruit and helping to
create the superfood category. The company operates the website
zennoa.com.
About SHANNEN Shannen Global is
an Indonesian-based e-commerce and direct selling company founded
in 2018 that has become one of the leading beauty and skincare
companies in Indonesia with revenues exceeding $25 million USD. The
company sells facial and body washes, lipsticks, brow shapers and
other products, and operates the website shannenglobal.co.
About LIMU Florida-based LIMU
is the category creator and global leader in fucoidan-rich
nutritional products and LIMU seaweed-based products and energy
drinks. The Company commercializes its portfolio via e-commerce and
direct channels and has over 2,000 independent, third-party,
unsolicited scientific research studies on its supernutrient,
fucoidan, available for public review on PubMed.gov. The
company operates the website thelimucompany.com.
About MAVIEMaVie is a DNA
mapping and wellness company with predictive genomic sequencing and
a range of nutritional products customized to an individual’s DNA
makeup. The company sequences an individual’s DNA and then develops
a customized set of nutritional and other products based on that
individual’s genetic makeup. MaVie, which is French for “my life,”
operates in Australia, Europe, Hong Kong, Singapore, South Africa,
and the United Arab Emirates. They manage the website
mavie.com.
Safe Harbor DisclosureThis
press release contains forward-looking statements that are made
under the safe harbor provisions within the meaning of Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements are any statement reflecting management's expectations
regarding future results of operations, economic performance,
financial condition, projections, the acquisition of ARIIX, Inc,
statements about the benefit of the transaction, the extent and
duration of COVID-19 on its business, and achievements of the
Company, including statements regarding NewAge’s expectation to see
continued growth. The forward-looking statements are based on the
assumption that operating performance and results will continue in
line with historical results. Management believes these assumptions
to be reasonable, but there is no assurance they will prove to be
accurate. Forward-looking statements, specifically those concerning
future performance, are subject to certain risks and uncertainties,
and actual results may differ materially. NewAge competes in a
rapidly growing and transforming industry, and risk factors,
including those disclosed in the Company's filings with the
Securities and Exchange Commission, might affect the Company's
operations. Unless required by applicable law, the Company
undertakes no obligation to update or revise any forward-looking
statements.
NewAge has exclusively partnered with the
world's 5th largest water charity, WATERisLIFE, to end the world
water crisis with the most innovative technologies available.
Donate at WATERisLIFE.com to help us #EnditToday.
For investor inquiries about
NewAge, please contact:
Investor Relations Counsel:John
Mills/Scott Van WinkleICR – Strategic Communications and
AdvisoryTel: 1-646-277-1254/1-617-956-6736newage@icrinc.com
NewAge Corporation:Riley
TimmerVP Investor RelationsTel:
1-801-870-8685Riley_Timmer@NewAge.com
NewAge Corporation:Gregory A.
GouldChief Financial OfficerTel:
1-303-566-3030Greg_Gould@NewAge.com
Photos accompanying this announcement are available at:
https://www.globenewswire.com/NewsRoom/AttachmentNg/9a0d894b-b028-42ae-abb6-5c4af6e371e1https://www.globenewswire.com/NewsRoom/AttachmentNg/3a82f13a-d624-4fc3-a26a-207a86b642e9
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