The Alkaline Water Company Inc (NASDAQ: WTER), the famed bottled water brand loved by the likes of Beyoncé and Mark Wahlberg, has just announced it has entered into an agreement to acquire AQUAhydrate®, Inc., a Los Angeles-based bottled water producer backed by Sean “Diddy” Combs, Jillian Michaels, and (yes, again) Mark Wahlberg, in an all-stock transaction.
Seeking to drive shareholder value via “synergies in operations, R&D, distribution, and sales,” Alkaine Water Co. and AQUAhydrate will work in tandem to launch a line of CBD-infused products, seeking to serve the booming market expanding around the popular cannabinoid, the former company explained.
These CBD products will add Alkaine Water’s pipeline of new products, which also include flavored waters. Management said thinks this merger will strengthen the company’s ongoing investments in product development, “by targeting these new products to each brand’s unique consumer target market.” The idea is to focus on families with the Alkaline88 product, and on active lifestyle consumers and athletes with AQUAhydrate.
“The AQUAhydrate and Alkaline88 brands align well and will support exciting innovations in flavors, sparkling and CBD products.”
In addition to the expansion in products, Alkaine Water has managed to retain all three big celebrity backers named above, Diddy, Michaels and Wahlberg, to endorse the new, combined brand. Diddy and Wahlberg will also remain investors.
The combined, total social media reach of Alkaline Water, AQUAhydrate and these three high-profile investors is estimated at 74 million followers across Facebook (NASDAQ: FB), Twitter (NASDAQ: TWTR) and Instagram.
Mark Wahlberg pointed out that when Diddy and himself first got involved in AQUAhydrate, they had a vision to “build a lifestyle company focused on health and wellness.” Looking back on this, he is now comfortable to say they’ve accomplished what they were after. “The AQUAhydrate and Alkaline88 brands align well and will support exciting innovations in flavors, sparkling and CBD products.”
Sean “Diddy” Combs, the famed rapper, producer and entrepreneur – an epitome of success, added, “We built AQUAhydrate from the ground up by securing deals with the largest retail grocery outlets, creating innovative partnerships and evolving the brand. Today, I am confident that we are creating a powerhouse by combining AQUAhydrate with one of the largest, fastest growing alkaline water companies in the world. I look forward to this next stage of growth as we build one of the most recognizable brands for premium water.”
Beyond social media strength and celebrity backers, the new company will boast one of the largest distribution networks for a CBD-related brand in America. The new products are expected to be distributed via Walmart, Target, Safeway, Rite Aid, GNC Meijer, QT, Albertsons, CVS, Albertson, Kroger, Schnucks, Smart & Final, Jewel-Osco, Sprouts, Bashas’, Stater Bros. Markets, Unified Grocers, Bristol Farms, Vallarta, Superior Foods, Ingles, HEB Brookshire’s, Publix, Shaw’s, Raley’s, Food Lion, Harris Teeter, and Festival Foods.
“We built AQUAhydrate from the ground up by securing deals with the largest retail grocery outlets, creating innovative partnerships and evolving the brand. Today, I am confident that we are creating a powerhouse by combining AQUAhydrate with one of the largest, fastest growing alkaline water companies in the world.”
Leveraging this strong retail distribution network, the new, combined company expects to drive sales around $65 million dollars for fiscal 2020, on a pro forma basis.
Commenting on the acquisition, The Alkaline Water Company’s Chairman Aaron Keay noted CBD-infused health drinks will the company “on the map within the rapidly growing market, and through education and our ambassador program, will make us a strong competitor for this $22 billion category by 2021.
“We view the acquisition of AQUAhydrate as extremely synergistic and accretive, and look forward to working closely with new director nominees Ira Tochner from leading investment firm Yucaipa who invested over $27 million in AQUAhydrate and investor Matthew Howison of Emerald Partners; as well as investors Sean ‘Diddy’ Combs and Mark Wahlberg, who have personally invested over $20 million into the development and growth of AQUAhydrate and brand ambassador Jillian Michaels. We believe that collectively, the board of directors, management teams and ambassador strength of the combined company has the opportunity to be the market leader in the premium water category and in the new platforms of products we will be rolling out under both brands,” Keay said in a press release.