CV Sciences, a renowned consumer wellness company specializing in hemp extracts and other natural, science-backed ingredients, has recently marked a significant expansion into the plant-based food market. The company announced the acquisition of Cultured Foods, a leading manufacturer and distributor of alternative plant-based vegan foods, for a total consideration of up to $535,000. This move is seen as a strategic step to diversify CV Sciences’ portfolio and establish a stronger presence in the burgeoning global vegan food sector.
Cultured Foods, based in Warsaw, Poland, produces a range of curated plant-based products that are currently available in 15 different European countries. The acquisition is structured as an equity purchase, making Cultured Foods a wholly-owned subsidiary of CV Sciences. This deal not only brings a variety of specialty plant-based foods to the US market but also establishes a European base for the sale and distribution of CV Sciences' +PlusCBD products. With this, CV Sciences opens doors to new retail and distributor partners across Europe, thereby enhancing its global reach.
Joseph Dowling, CEO of CV Sciences, expressed enthusiasm about the acquisition, noting it as a key milestone in the company's transition to a global health and wellness entity. The synergies from this acquisition are expected to leverage CV Sciences' U.S. distribution and business-to-business (B2B) expertise, driving long-term growth and shareholder value. The immediate plan involves leveraging the B2B distribution network to introduce sustainable plant-based foods into the US natural product channel while also expanding Cultured Foods' business in the European market.
The global vegan food market is anticipated to grow fivefold by 2030, driven primarily by millennials and flexitarians. This demographic shift underlines the growing consumer demand for sustainable and ethical food choices. CV Sciences plans to meet this demand by leveraging Cultured Foods' infrastructure to introduce selected products from its flagship brand PlusCBD™ across Europe, in compliance with local laws.
The acquisition deal included a cash payment of $175,000, the delivery of 7,074,270 shares of CV Sciences' common stock valued at $250,000, and a potential earn-out payment of up to $110,000 if Cultured Foods meets certain performance thresholds in the first year post-acquisition. Barbara McWhorter, the founder of Cultured Foods, will continue as the general manager of the European manufacturing and distribution business. This acquisition is expected to be accretive in its first year and contribute to scaling economics thereafter.
CV Sciences, with its primary offices and facilities in San Diego, California, and Warsaw, Poland, continues to operate a drug development program focused on developing and commercializing CBD-based novel therapeutics. The company's venture into the plant-based food market with the acquisition of Cultured Foods reflects its commitment to evolving into a more diverse global health and wellness company, resonating with the shifting preferences of modern consumers towards more sustainable and health-conscious food options.