Flora signs LOI to acquire 90% stake in Colombia’s Kasa Wholefoods

The US-based company Flora Growth has entered into a letter of intent (LOI) to acquire a 90% stake in Colombia-based Kasa Wholefoods Company.

Kasa Wholefoods produces exotic (Amazonian) chocolates and fruit juices. It operates under the Mambe brand in Colombia and offers a wide range of fruits.

Its portfolio includes mango, acai, passion fruit, camu camu, guava, bananas, strawberries, oranges and apples. It produces chocolate confectionery using 70% Colombian cacao.

Kasa’s products are distributed to retailers including Carulla, Tostao Café & Pan, Deli Reposteria.

Flora Growth CEO Damian Lopez said: “We are excited to acquire an entrepreneurial, innovative company like Kasa Wholefoods. They have done an excellent job of developing a line of world-class juices and chocolates.

“There is immense demand for CBD-infused products in Latin America and worldwide. We will combine our organic CBD-Oil with Kasa’s organic Amazonian based fruit juices and chocolates to satisfy this demand.”The company expects to obtain regulatory approval in Colombia to infuse food & beverages with CBD in 2020.

Flora will pay Kasa shareholders $294,000 in cash and repay Kasa’s outstanding loan payables of $91,000.

Kasa shareholders intend to retain a 10% equity interest in the company, which may not be diluted until $5m is invested in Kasa by Flora.

The deal is subject to the two firms entering into a definitive agreement and receiving necessary regulatory approvals.

Kasa began research and development for its CBD-infused juices and chocolate last year.

It has already created a line of CBD-infused juices and chocolate bars, which it plans to sell in the Latin American market after receiving regulatory approval, expected this year.