Through this transaction, Upexi and Bloomios have forged a long-term partnership. Moving forward, Bloomios will manufacture products retained by Upexi and Upexi has provided significant financing to enable this transaction.
The acquisition includes Infusionz's portfolio of CBD gummy brands and customers, along with its associated order flow, product formulations, manufacturing operations, equipment and sales team.
The total purchase consideration of approximately $23.5 million consisted of cash consideration of $5.5 million and $18 million of non-cash consideration including $4.5 million senior secured convertible debenture, a $5 million secured subordinated promissory note, and shares of a newly created Series D Convertible Preferred Stock with a value of $8.5 million.
The added operations are expected to more than double Bloomios' current production capacity across key production lines while reducing redundant costs across both the acquired and existing operations. The acquisition will contribute in excess of $22 million in annualized gross revenue.
"This acquisition is highly accretive, and we believe that it will position Bloomios to uplist to Nasdaq," said Barrett Evans, president and chief strategy officer of Bloomios. "Further, it will allow the company to acquire additional complementary manufacturing operations and brands."
The new manufacturing operations, large existing customer base, and professional sales team will rapidly expand Bloomios's gummy manufacturing footprint. Additionally, the company believes the Infusionz brand will launch its expansion into the direct-to-consumer market and other new distribution channels.
"This acquisition enables us to better address unmet demand and significantly improve our operational capabilities," stated Michael Hill, CEO of Bloomios. "In addition to the new brands and expanded manufacturing capacity, it brings with it a substantial amount of new order flow, positive cash flow, valuable customer relationships, and a highly-capable sales team to drive further growth. We believe this acquisition extends our ability to rapidly create and launch products into today's booming market for natural, plant-based nutraceutical products. It should allow Bloomios to tap into the high margin direct-to-consumer market for the first time."