£3m acquisition opens up European market for CBD specialist Always Pure Organics
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Always Pure Organics (APO), the Manchester-based supplier of cannabis-based products, has completed a £3m takeover deal.
It has acquired the successful Belgian cannabis companies, Distribution Legal Hemp (DLH) and NexGen in a transaction funded by existing capital.
APO founder and CEO, Gavin Ogilvie, will head the enlarged company, and DLH/NexGen’s CEO, Joeri Perneel, will start in a newly created role as APO’s chief commercial officer, while retaining a focus on the companies’ activities in the Benelux and French markets.
The purchase gives APO, a top three wholesale and white label market leader in the UK, Japan, and Europe, access to a much needed distribution hub.
With 80% of its client base in Europe, the post-Brexit acquisition enables APO to continue to offer its EU clients a quick and efficient supply service.
While APO is a B2B business, providing wholesale and white label products to a who’s who of Europe’s top high street retailers and lifestyle brands, DLH has its own successful B2C wellness retail brands, Pure CBD, Pet CBD and tobacco substitute brands Sensy and Jane’s Garden, and has direct access to multiple major retail chains selling tobacco substitute and wellness products across Europe.
The acquisition gives APO a strong foothold to build market share in the fast growing CBD industry’s European retail sector.
DLH will benefit from becoming part of a larger, global facing company which has the capacity to upgrade infrastructure and operating systems and increase workforce opportunities at the Belgian base. APO says it also has best in class experts in sales, administration, manufacturing and logistics.
Over the past two years, both companies have grown incredibly fast. APO has increased staff from six to 62 and in the past year alone grown its revenues 215% to a 2021 forecast of £12.6m. Similarly DLH grew 170% in the past year.
Gavin Ogilvie said: “As part of our ambitious global expansion plans, DLH gives us a brilliant complementary business.
“Belgium is the first nation in Europe to legalise the use of CBD flower through their existing tobacco substitutes legislation, so by buying DLH we have instantly secured 75% of Belgium’s CBD flower market.
“It’s likely that France will also seek to regulate the CBD flower through the same legal mechanism before long, and APO will, therefore, be in a strong strategic position to take full advantage of this new market when it opens.”
DLH CEO, Joeri Perneel, said: “Both companies have known each other and worked together for more than two years.
“The deal is, on all levels, complementary. DLH/NexGen is the market leader in Belgium within the segment of tobacco substitute and is a pioneer in the segment of wellness.
“We are only at the beginning of the journey and I’m happy to work with APO to build this new group into a world class player.”