First they started brewing cannabis-infused beer, now Althea Group (ASX: AGH) is bringing cans of cannabis-based sodas to the market that will inevitably have certain consumers checking whether they’re tripping.
The move is set to shake up the cannabis-based products market as a recreational product that will make a bold entry into the burgeoning US cannabis beverages market, which is bubbling with potential.
Melo, the new brand, is a joint venture (JV) with Flora Growth Corporation (NASDAQ: FLGC) that will proceed after Althea raised $2 million for the project from institutional and sophisticated investors.
“We are excited to have signed the establishing agreements with Flora, marking a significant step forward in Peak Canada’s expansion into the US cannabis beverages market,” said Althea Group Managing Director, Joshua Fegan.
“The JV represents a major growth opportunity for Peak Canada, combining our industry-leading expertise in cannabis beverages with Flora’s expansive distribution network.”
Peak Canada, a subsidiary of Althea, already holds a 40% share of the Canadian cannabis beverages market where it will seek to leverage its commercial success in the US seeking to replicate its sales model from north of the border.
The US market for cannabis beverages is currently valued at a modest $1 billion but research referenced by Althea forecasts that number to reach an ambitious target of $19 billion in just four years. No indications were given as to whether the researchers were high on their supply when publishing those numbers, though.
“With the US market projected to grow exponentially, we are extremely well-positioned to capitalise on this momentum and deliver innovative, high-quality cannabis beverages to consumers across the nation,” added Fegan.
The JV has cooked up a line-up of six cannabis beverages: three 5mg THC seltzers and three 10mg THC sodas. These fizzy delights will be sold online via Flora’s eCommerce platform, which boasts over 350,000 registered customers. Additionally, they’ll be hitting the shelves of wine and liquor stores across the US within the next three months.
Through Peak USA, Althea plans to manufacture its signature cannabis emulsion, Envision, using locally sourced hemp. This ensures that the drinks not only pack a punch but also support local agriculture. Peak Canada will oversee the initial operations but consumers can expect similar product quality to those sold in Canada where recreational cannabis use has been more progressive than the US in recent years where laws still vary between States.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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1 Comment
Shraddha13
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