Week in Review

Ah, Halloween! One of my favorite seasonal festivities, filled with costumes, pumpkins, and cavities. Like tiny door-to-door salesmen, children come asking for candy in exchange for a smile. At my old house, once the kids had tired themselves out from trick-or-treating, an unsettling air used to blanket my neighborhood like a thick fog. Children’s laughter faded into an eerie silence, followed by blood-curdling shrieks. That’s when they came out…the little gremlins we call teenagers. Teenagers are young enough to trick-or-treat but are apparently old enough to be asshats. From doorbell ditching to egging cars, teenagers used to commit countless atrocities in my neighborhood during Halloween. If you think that’s scary, then you’re in for a treat.

Leading up to Halloween, even plant-based companies have been getting into the Halloween spirit. Oumph! is a Swedish plant-based food brand offering a variety of meat alternatives. For Halloween, Oumph! is inviting Stockholmers to try the world’s first plant-based burger resembling human meat. By creating this special edition burger, Oumph! wants to prove that it is possible to create unique and exciting plant-based products that taste just like meat. Similarly, Noah Schnapp, who plays Will Byers in the hit Netflix series Stranger Things, announced his new brand TBH, a hazelnut spread similar to Nutella. However, TBH is gluten-free, kosher, has three times more protein than other hazelnut spreads, contains no palm oil, and comes with half as much sugar as the category leader. Additionally, TBH uses 100% recycled materials in its packaging.

Closer to home, companies like Zoglo’s Incredible Food Corp. (ZOG.C), Eat Well Group (EWG.C), Boosh Plant-Based Brands Inc. (VEGI.C), and Organic Garage Ltd. (OG.V) have all had a productive couple of weeks leading up to Halloween. In this week’s plant-based sector roundup, we will be discussing retail expansion, acquisitions, new products, and more. Let’s get into it!

Zoglo’s Incredible Food Corp.

 

• $23.94M Market Capitalization

 

Zoglo’s Incredible Food Corp. (ZOG.C) is a plant-based food company that has been using leading-edge technology to create plant-based food solutions that deliver superior taste, value, and innovation. The Company boasts a portfolio of more than 25 plant-based, non-GMO, nitrate-free products. Aside from sounding like a circus attraction, Zoglo’s is recognized for its Incredible™ product line, which features a variety of healthy plant-based food alternatives, including appetizers, veggies, and meat substitutes. Furthermore, despite having only listed on the Canadian Securities Exchange (CSE) on July 26, 2021, the Company has its products listed at 700 retail stores across Canada, including major retailers such as Shoppers Drug Mart, Metro, Loblaws, and Walmart. It is also worth noting that Zoglo’s has a foot in the European plant-based market through a Letter of Intent (LOI) to acquire 50.5% of Monday Swiss UK, a leading European-based developer and manufacturer of plant-based food alternatives.

What has Zoglo’s been up to lately? On October 21, 2021, the Company announced that it had partnered with Classic Touch Foods, a division of Ontario-based Classic Group of companies. Classic Touch Foods is recognized for providing its clients with a wide selection of ready-to-eat (RTE) products offered throughout Ontario and other parts of Canada. Furthermore, the division is responsible for all of the food production associated with the Classic Groups’ divisions, including Classic Cuisine and Clasique Event Planning & Catering. With an experienced team and a state-of-the-art RTE 50,000 sq ft. production facility, Classic Touch creates foods from simple continental breakfasts to elite functions.

“We are extremely excited about this new arrangement and looking forward to creating new meal solutions that will soon see Zoglo’s Incredible & Classic Touch Foods combine our collective expertise to build in a new segment of plant-based food innovation,” said Anthony Morello, CEO of Zoglo’s.

According to the terms of this partnership, Zoglo’s will introduce 100% plant-based and vegan offerings. More specifically, the partnership will entail the creation of a co-branded product line including ready-to-heat and eat offerings such as Lasagna, Butter Chicken, and Spaghetti & Meatballs. Most recently, on October 25, 2021, Zoglo’s announced the listing of its products with Foodland supermarkets, further strengthening the Company’s presence in Ontario. Keep in mind, Foodland is a subsidiary of Sobeys, a leading Canadian grocery chain. Currently, Foodland operates 200 stores across Atlantic Canada, and in Ontario alone, Foodland has 136 stores that will carry 6 of Zoglo’s products from its Incredible™ product line.

Eat Well Group

 

• $77.84M Market Capitalization

 

Eat Well Group (EWG.C) is a vertically integrated plant-based foods investment company combining the best of agribusiness, food tech, and consumer packaged goods (CPG) brands to supply the world with innovative, delicious, and better for you foods. Similar to companies we have covered in the past, such as Billy Goat Brands (GOAT.C), Eat Well is an investment company with a focus on Environmental, Social, and Governance (ESG) investments. With this in mind, Eat Well is focused on sustainability, particularly how products, practices, and partners contribute to sustainable business development. Cummutaveily, the Company’s team has decades of experience cultivating ESG principles leveraging experience from the Quaker Oats Company, Gatorade, and Frito Lay, to name just a few recognizable companies.

What has Eat Well been up to lately? On October 28, 2021, the Company announced that it had agreed to definitive terms to acquire a preferred equity position in Amara Organic Foods (“Amara”). Amara is a rapidly growing North American plant-based baby food brand. The company uses science and proprietary IP to create healthy, organic, non-GMO, plant-based, and convenient food for babies and children. Amara offers a variety of products, including the company’s baby blend line, which is designed to mix with breast milk, formula, or water for a gentle transition to starting solids. Amara also offers its new snack line, featuring no added sugar, 100% organic whole fruit, and vegetable blend baby meals. Amara’s products are sold in major retailers across North America, including Whole Foods, Costco, Amazon, and Walmart Canada.

“The investment in Amara is a major event for Eat Well Group as we participate in the transformation of what modern food looks like using leading foodtech and plant-based nutrition, paired with a beautiful brand…Amara provides us with a premier investment opportunity into the CPG sector with mass distribution, focused product efforts, and a lean operating team that’s proven an ability to scale. Keep an eye out for further investments in the future that can expand Eat Well Group’s investment portfolio of CPG brands,” commented Mark Coles, Chief Investment Officer.

Some of the most notable strategic rationales behind acquiring a majority stake in Amara include:

• Vertical Integration: Completes the initial phase of Eat Well Group’s full vertical integration investment strategy with a powerful consumer packaged goods (“CPG”) brand in a category not saturated with other plant-based players
• Distribution: Amara’s current distribution includes some of the largest retailers from around the globe including, Amazon, Costco, Walmart Canada, and more
• Baby Food Market TAM: Provides Eat Well Group with entry into the lucrative baby foods CPG category, projected to reach USD$96.3 billion by 2027,¹ growing at a CAGR of 6.0% from 2021 to 2027
• Further SKU’s: Adds 14 SKUs to Eat Well Groups portfolio

 

According to the terms of the investment, Eat Well will be issued 2,047,299 Series A preferred shares in the capital of Amara in exchange for a subscription price of USD$11,600,000. The initial investment represents a 51% equity ownership in Amara on a fully-diluted as-converted basis. USD$1,000,000 is to be paid on closing of the initial investment. The remaining USD$10,600,000 will be subject to a deferred payment schedule with quarterly installments of approximately USD$1.3 million for a period of 24 months following the closing of the initial investment. That being said, upon full payment, Eat Well may exercise an option to acquire an additional 29% of Amara at a USD$100,000,000 valuation for an aggregate purchase price of USD$29,000,000 from other shareholders of Amara.

Boosh Plant-Based Brands Inc.

 

• $19.175M Market Capitalization

 

Boosh Plant-Based Brands Inc. (VEGI.C) is a plant-based nutritional comfort foods company committed to offering quick meal options that are 100% plant-based. Boosh has developed six 100% plant-based, heat-and-serve bowls for one as well as entrees for two. With this in mind, Boosh products are intended to help consumers meet their health goals by providing convenient plant-based meals for people who find it difficult to prepare meals from scratch. Boosh started with Connie Maples, an entrepreneurial badass who started making plant-based dishes in her tiny kitchen. For years, she would deliver frozen or hot meals within her close circle, eventually distributing small batches of food weekly to local customers throughout the Greater Vancouver Area. Thus, Boosh was born, a now publicly-traded company with products sold in grocery stores across Canada.

What has Boosh been up to lately? On October 18, 2021, the Company announced that it had completed its previously announced acquisition of Pulse Kitchen Speciality Foods Ltd. The aggregate purchase price for Pulse Kitchen was $300,000 in cash, payable over a 12-month period in equal installments at closing. Who is Pulse Kitchen? Pulse Kitchen is a food company producing high-quality 100% plant-based, gluten-free cheese, made from nuts, seeds, pulses, and other fine ingredients. Forgive my ignorance, but what the hell are pulses?

“We’re methodically executing on our business plan which includes four separate revenue streams…Organic growth through the opening of new retail stores as well as servicing our existing 400 plus retailers through re-orders, E-commerce through companies like ShopVejii.com in both Canada and the US, selling to US retail stores through our US natural food broker, and successful acquisitions,” commented Jim Pakulis CEO of Boosh Food.

Pulses apparently refer to the edible seeds of plants in the legume family. They grow in pods and come in a variety of shapes, sizes, and colors. Currently, the United Nations Food and Agriculture Organization (FAO) recognizes 11 types of pulses, including dry beans, dry broad beans, dry peas, chickpeas, cow peas, pigeon peas, lentils, Bambara beans, vetches, lupins, and pulses nes. Maybe if collect all 11 pulses I will be able to summon Shenron and make a wish. With this in mind, Pulse Kitchen’s products are already sold in approximately 250 grocery stores in Canada, including Whole Foods, Healthy Planet, and Nature’s Fare, to name just a few. Most recently, on October 25, 2021, Boosh announced that it would begin launching its plant-based shelf-stable vegan Mac & Cheese line at Canada’s Planted Expo. With the launch of its Magnificent branded Mac & Cheese product line, Boosh now has 24 plant-based SKUs under its belt.

Organic Garage Ltd.

 

• $26.294M Market Capitalization

 

Organic Garage Ltd. (OG.V) is an organic retail food business with over 14 years of operating history in the GTA and is committed to providing consumers with the highest-quality organic products without sacrificing affordability. The Company offers more than 9,000 SKUs covering all product categories in order to create a one-stop shop for customers. These categories include produce, grocery, meat, bakery, vitamins, health, and beauty. Through unique branding, customer incentives, and quality products, Organic Garage is working towards establishing long-term customer relationships and promoting brand loyalty. With four stores located in Ontario, Organic Garage hopes to take advantage of Canada’s organic retail market, which was valued at $5.4 billion in 2019, ranking sixth in the world.

What has Organic Garage been up to lately? On October 19, 2021, the Company announced that its plant-based food company, Future of Cheese, had successfully launched its initial line of butter across selected retailers in Ontario, including Organic Garage’s stores. It’s about time! Following Organic Garage’s acquisition of Future of Cheese (FOC) on March 4, 2021, the Company announced on March 17, 2021, that its first collaborative product with FOC would include a rich, cultured plant-based butter. Vegan butter seems like a pretty niche market, however, according to Fior Markets, the global vegan butter market is expected to grow to USD$1.77 billion by 2026, expanding at a CAGR of 4.65% between 2019 and 2026.

“This initial launch marks a significant milestone for the Company…We are extremely excited to introduce our plant-based butter to the market, and confident that retail consumers and foodservice customers alike will be blown away by how this product tastes and performs in the kitchen, comparable to the best of conventional dairy-based butter,” stated Craig Harding, Co-Founder and Culinary Director of Future of Cheese.

That being said, there’s a pretty penny to be made off of the vegan butter market. Having finally launched its vegan butter, Organic Garage is now well-positioned to capitalize on this lucrative opportunity. I’m not trying to butter you up when I say this, but the Company’s initial run of plant-based butter sold out within 48 hours. In addition to Organic Garage’s successful launch of plant-based butter, on October 28, 2021, the Company announced that it had engaged Savills Real Estate. Through this engagement, Savills will represent the Company in locating, negotiating, and signing prospective new Organic Garage sites, as the Company prepares for its largest expansion plan since its inception.

To date, Organic Garage has four operational stores throughout Ontario, with a fifth currently under construction. With this in mind, the Company and Savills have analyzed the Ontario market and outlined numerous locations where Organic Garage will be accepting new site proposals from agents and developers. That being said, all sites must be within 3 kilometers of the towns or cities listed above, and approximately 10,500 sq ft. in size. Moreover, sites will have to meet the strict financial and operational criteria outlined by Organic Garage.

In fear of doxing myself, I won’t tell you what city I am from. However, I will tell you that I am very excited about the possibility of an Organic Garage store opening near me in the future. Overall, with the cheese now rolling, Organic Garage’s vegan butter and its upcoming dairy alternative products will be strong revenue drivers for the Company. As a result, Organic Garage’s financial position will likely undergo some pretty significant change in the next few months.