Sugarmade
Finalizes Terms of Landmark Deal to Acquire Top Hydroponics
eCommerce Supplier,
Scaling to $37Million Annualized Forward Sales
NEW
YORK, October 22, 2019 -- InvestorsHub NewsWire –
Sugarmade,
Inc. (OTCQB:SGMD) ("Sugarmade",
"SGMD", or the "Company"), a major supplier to the hydroponic
cultivation and hemp sectors, is pleased to announce the
finalization of terms between Sugarmade
and
BZRTH Inc. for a definitive agreement whereby Sugarmade
will
acquire BZRTH Inc. ("BZRTH"), a leading ecommerce supplier to the
rapidly expanding hydroponic agricultural space.
The Parties expect the acquisition to be finalized and closed by
October 31, 2019.
The
acquisition will position Sugarmade
to
book all revenues from both entities, creating a combined entity
that, based on most-recent financial estimates, stands to produce
$37 million in annual sales and positive cash flow and EBITDA,
resulting in Sugarmade
becoming
one of the largest publicly traded companies in this fast growing
sector.
"After
months of negotiations, we now have robust terms set into place
that represent enormous value for Sugarmade
shareholders,"
commented Jimmy Chan, CEO of Sugarmade.
"This acquisition, in itself, will dramatically augment the
Company's top and bottom line numbers and massively expand our
overall presence in the booming hydroponics and hemp ecommerce
space. Further,
it also represents the central piece of our overarching roll-up
strategy to position Sugarmade
as
the dominant pick-and-shovel entity on the hydroponics side
catering to producers in the explosive market for hemp and
hemp-related crops in North America."
Management
notes the investment boom in the production of raw hemp and
hemp-related crops has tightened margins for growers through a
massive expansion in the sheer number of producers. This process is
driving an associated boom in the market for goods and services
that improve efficiency in producing these crops as producers
compete for market share and return on invested capital.
Sugarmade
and
other companies in the hydroponic supplies markets are perhaps the
most natural beneficiaries of this dynamic due to the ability to
maximize output relative to inputs – invested capital, time,
energy, and resources.
According
to multiple sources, the global market for hydroponic and hemp
cultivation supplies will remain robust for many years. For
example, Maximize Market Research, PVT. LTD. recently forecasted
the worldwide market during 2017 at US$26.6 billion and forecasts
the market to reach US$37.7 Billion by 2026.
Sugarmade
has
dedicated itself to becoming the dominant supplier in North America
for products that address this need.
To
effect this strategy, the Company places paramount importance on
dominating the ecommerce side of the hydroponics market. The BZRTH
acquisition will accompany its existing Master Marketing Agreement
with BizRight,
LLC,
the
sister company to BZRTH, whereby the Company will be able to
vertically integrate ecommerce through ZenHydro.com (and several
additional hydroponics ecommerce sales portals) with a 55,000 sq.
ft. fulfillment center and a market leading logistics platform,
resulting in an entity operating in a leadership position as a
hydroponics equipment provider to the soaring North American hemp
and hemp-related cultivation marketplace.
Mr.
Chan continued, "With this acquisition, we believe
Sugarmade
has
entered into a "best of all worlds" situation. It is
clear that
the
hydroponics market is growing fast, as is the hemp
marketplace. Additionally, the ecommerce sector is
booming. Sugarmade
and
BZRTH capture growth from all of these market sectors and combine
these with what is already stellar growth coming from BZRTH.
We are pleased to announce today that since inception,
the operations we are acquiring have grown astonishingly over 40%
compound annual growth rate. Of course, this compares very
favorably to the ecommerce sector, which grew at 15% last year and
the overall retail market, which grew at only 3.9%. We cannot
think of a better market in which to continue our
expansion."
About
Sugarmade,
Inc.
Sugarmade,
Inc. (OTCQB: SGMD) is a product and branding
marketing company investing in operations and technologies with
disruptive potential. The Company is becoming a leading supplier to
the growing hemp industry and is benefitting from the growth of the
hydroponic marketplace. The Company is in the process of acquiring
several leading hydroponic and agricultural supply companies that
are currently producing in excess of $70 million in annual
revenues. The Company also operates Carryoutsupplies.com, a leader
provider to the quick service restaurant industry.
FORWARD-LOOKING
STATEMENTS: This release contains "forward-looking statements"
within the meaning of the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995. Forward-looking
statements also may be included in other publicly available
documents issued by the Company and in oral statements made by our
officers and representatives from time to time. These
forward-looking statements are intended to provide management's
current expectations or plans for our future operating and
financial performance, based on assumptions currently believed to
be valid. They can be identified by the use of words such as
"anticipate," "intend," "plan," "goal," "seek," "believe,"
"project," "estimate," "expect," "strategy," "future," "likely,"
"may," "should," "would," "could," "will" and other words of
similar meaning in connection with a discussion of future operating
or financial performance. Examples of forward looking statements
include, among others, statements relating to future sales,
earnings, cash flows, results of operations, uses of cash and other
measures of financial performance.
Because
forward-looking statements relate to the future, they are subject
to inherent risks, uncertainties and other factors that may cause
the Company's actual results and financial condition to differ
materially from those expressed or implied in the forward-looking
statements. Such risks, uncertainties and other factors include,
among others. such as, but not limited to economic conditions,
changes in the laws or regulations, demand for products and
services of the company, the effects of competition and other
factors that could cause actual results to differ materially from
those projected or represented in the forward looking
statements.
Any
forward-looking information provided in this release should be
considered with these factors in mind. We assume no obligation to
update any forward-looking statements contained in this
report.
Corporate Contact:
Jimmy
Chan
+1-(888)-982-1628
info@Sugarmade.com
Press & Media Inquiries:
EHC
Branding Agency
Info@EHCBrandingAgency.Com
(626)
MJ-BRAND