Neptune Wellness Solutions Inc., a North American leader in extraction, formulation and turnkey packaging solutions, has completed the acquisition of the assets of SugarLeaf Labs, LLC and Forest Remedies LLC (collectively, “SugarLeaf”). The acquisition was first announced on May 9, 2019.
“The acquisition of SugarLeaf, combined with Neptune allows us to create a leading North American extraction platform with significant capacity available to serve our customers on both sides of the border,” said Michael Cammarata, Neptune President and CEO. “Furthermore, considering the significant growth anticipated in hemp-based products, this acquisition provides Neptune with capabilities to satisfy a wide array of clients. Finally, we anticipate a significant contribution from this acquisition, as indicated by the large earnout structure providing adequate risk sharing.
SugarLeaf brings to Neptune
- New capabilities to supply hemp extracts and finished products to a broad U.S. customer base.
- Extraction capacity that is expected to reach an annual run rate of 1,500,000 kilos of biomass by the end of 2019 with opportunities to further expand capacity.
- Cutting-edge cold ethanol processing technology producing high-quality broad-spectrum extracts and refined full spectrum extracts.
- Strategic and well diversified sourcing established, with multiple local and large regional hemp farmer partners, ensuring traceability of finished product back directly to the farms.
- Rigorous testing protocols to ensure high quality biomass.
- Pursuit of organic certification and already sourcing from farmers who are certified organic or using organic practices.
- Management team with extensive experience in hemp extraction.
- The U.S. market for hemp-derived CBD based products is evolving rapidly driven by multiple product categories and could reach $US 16 billion (1) by 2025.
“We are extremely proud to be part of the Neptune family and look forward to working in collaboration with their entire team,” said Peter Galloway, President of SugarLeaf. “The hemp extract opportunity is significant, and our sales pipeline is healthy giving us comfort that we are well positioned to execute on our business plan.”