Halo Collective (HALO.E) inked a partnership and licensing agreement with beverage company, Elegance Brands, to add THC-infused drinks to the product’s list today, according to a press release.
The transaction includes an exclusivity clause for the intellectual property for Elegance’s THC brands and support for Halo on operations and manufacturing when it comes to the sale of certain THC-infused beverage products. There will be an exchange of a 2% royalty on all sales from said beverage brands.
“The transaction will facilitate a long-term and mutually beneficial partnership between both companies. Elegance is well versed in developing and marketing premium beverages and will utilize its experience to support Halo’s efforts to bring THC beverages to market, aid in production, and enhance distribution. Elegance Brands has created a unique and exciting portfolio of THC products, and with this transaction, we step into one of the fastest-growing segments of the functional beverage market,” said Kirin Sidhu, CEO of Halo.
Halo is a vertically integrated cannabis company involved in cultivation, extraction, manufacturing and distribution of cannabis flower, oils and concentrates. They boast having sold over nine million grams of oils and concentrates in the company’s lifespan. Elegance Brands, in contrast, is a global beverage company involved in product development, marketing and distribution. Their flagship brand is SWAY Energy + Immunity Drink, and they offer an array of functional beverages, including spirits and alcohol brands, including Elegance Vodka.
The licensing agreement allows Halo exclusive license access to Elegance’s THC-infused beverage product portfolio, which includes: Arvo, Zen, Life Brew, High Life THC Cocktails, Island THC & Coconut Water, Stoney Island THC Cold Brew Coffee, 420 Friendly THC Lemonades, and California THC Bitters.
“Beverages are a strategic addition to Halo’s existing product offering, and through this innovative partnership, we will leverage Elegance’s experience to bring THC beverages to retailers and consumers across the U.S. market. We believe that consumers are actively seeking innovative options for THC beverages, and this partnership aims to meet that demand. We look forward to being a shareholder of Elegance and participating in the value creation from its growing portfolio of premium brands.
The first product launch they’re anticipating under the partnership will be the Zen THC Social Tonics in a range of four flavours, including Raspberry Hibiscus, Ginger Lime, Mango Habanero, and Citrus Lavender. They intend to have these in distribution by Q4, 2021 in California and Q1, 2022 in Oregon.
THC-infused beverages saw considerable development in 2020 and the growth is anticipated to continue throughout 2021. More than 1,000 dispensaries in California alone are licensed to sell these beverages and sales have increased and year-over-year growth is over 110% Q1, 2021.
The numbers for California’s beverage retail sales for beverages in Q1 $7.09 million with carbonated beverages taking the lead with 73% of the total. Oregon, which is a smaller market with only 700 dispensaries licensed to sell these beverages, pulled in $4.1 million in sales last year with carbonated beverages pulling in 78% of that market.
Shares are flat on the news today, and holding steady at $0.075.