Yooma Wellness (YOOM.C) acquired U.S. based manufacturer and retailer of cannabis ingredients and consumer products, Socati, earlier this week for $25,000,000, according to a press release.
Yooma picked up Socati because the company offers expansion opportunities in the United States, especially after picking up UK and European wellness brands Blossom, MYO Plant Nutrition, What the Hemp and Hello Joya. Yooma is also selling CBD in Asia, as well as hemp and wellness, beauty and skincare in China through their ecommerce platform.
“Socati’s unique ability to deliver consistent cannabinoid ingredients and finished products that meet industry-leading quality standards makes Socati a natural fit for Yooma. The Socati acquisition further expands Yooma’s global footprint by adding Socati’s customer base which includes some of the largest consumer brands in the CBD and wellness space across North America,” said Lorne Abony, chairman of Yooma.
If you’re at all curious, Yooma is a cannabis company involved in the health and wellness products market specifically around the sale of hemp seed oil and hemp-derived and cannabinoid ingredients. They’ve got sales wrapped up with brick and mortar options, but also a sizeable ecommerce network capable of delivering a mix of wellness products through subsidiaries in China, Japan and the United States.
We don’t hear a lot about cannabis in China, mostly because it’s been banned since 1985 and subject to exorbitant punishments—including potentially getting the death penalty for having a minimum of five kilos on your person, but you might only get anywhere from five years to a life sentence if they’re feeling lenient. In most cases, though, cannabis users just disappear for 10 to 15 days, and pay a maximum of 1,000 yuan.
You heard that right—they literally make you disappear for a few weeks for possession. Granted, that doesn’t stop Chinese folks from smoking it, leading to China blaming Canada for its pot problem. But (most of) China has separated cannabis from its hemp CBD cousin and as such, so much in fact that it manufactures one third of the world’s hemp.
Socati is mostly a one-facility company—doing business out of their 22,000 square foot Montana-based facility. They manufacture CBD primarily, but with inroads into cannabigerol (CBG) and cannabinol (CBN), as well as other functional ingredients. They also offer access to wellness products made with these ingredients.
In terms of intangibles, Yooma is also hoovering up Socati’s intellectual property and proprietary technology in extraction and separation, as well as their analytical capabilities.
Shares were flat today, and are presently holding at $1.30.