VANCOUVER, BRITISH COLUMBIA, CANADA, April 2, 2019, IONIC Brands Corp., formerly Zara Resources Inc., (CSE: IONC) announces the commencement of trading on the Canadian Securities Exchange (CSE) under the trading symbol IONC.
IONIC BRANDS is led by a team of successful entrepreneurs, that are dedicated to building a multi-state, consumer focused portfolio of luxury cannabis brands. IONIC BRANDS’s flagship asset is their #1 vaporizer pen brand in Washington State under the branded name “Ionic”. The Company’s initial focus was to dominate the most competitive state in the US and focus on building a premium brand within the cannabis concentrate products segment of the market, currently the fastest growing segment of the legal marijuana industry. The Ionic vaporizer pen is currently the top producer of concentrates in Washington State and has experienced year over year growth. IONIC BRANDS is taking their team, proprietary techniques and blueprint for dominating marketplace, as evidenced in Washington State and is aggressively expanding via entrances into new markets (Oregon and California) and accretive acquisitions as outlined below. IONIC BRANDS’s strategy is to be the leader of the highest-value segments of the supply chain in the west coast markets and expand eastwards via acquisitions.
Highlights of IONIC BRANDS
- Premium luxury portfolio of cannabis concentrate products: Established in 2015, IONIC BRANDS is an industry leader building a multi-state consumer-focused Brand portfolio consisting of award-winning premium and luxury brands in the concentrates space, the fastest growing segment of the legal marijuana industry. IONIC BRANDS has proven the ability to expand and operate multiple brands in multiple markets across the western United States, including California, Washington and Oregon.
- Scaling Nationally and Integrated Operations: In 2018, IONIC BRANDS expanded their vaporizer pen business into Oregon and California. Continuing to deliver on our pillars of Quality, Responsibility and Respectability. The IONIC BRANDS strategy is to own the highest-value segments of the supply chain in the west coast markets and expand eastwards via acquisitions: Further discussed below, the Company most recently adding the desirable Nevada market with a binding letter of intent (“LOI”) to acquire of Vegas Valley Growers (“VVG”). In Washington State, the Company will acquire a 140-acre cannabis farm located in Eastern Washington to cultivate input material for extraction. In 2019, the Company will deploy an aggressive national expansion strategy into new geographic markets and new product segments
- Disruptive entry into the cannabis-edibles and cannabis-infused beverage market via strategic acquisitions: Further discussed below, the Company entered into a binding LOI to acquire Zoots, a premium cannabis edibles company, and also acquired two of the very first cannabis-infused coffee patents granted by United States Patent and Trademark office from Canna Cafe. Together with Zoots and the coffee patents, Company will use its premium production touches and synergistically utilizing the IONIC brand name to disrupt the highly sought after cannabis-infused beverage market, valued at over $4 billion in Canada and the United States by 2022, according to a report by marijuan market research company The Arcview Group. Cowen and Company recently released a report in which it pinpoints Starbucks as the likely first major chain that will market products featuring cannabinoids (CBD). IONIC BRANDS plans on adding domain expertise and engaging various consultants to explore how to best monetize owning these critical patents.
- Robust pipeline of growth opportunities: The Company is in negotiations to acquire additional licensed facilities for manufacturing and distribution in California and Colorado. Further acquisition opportunities in Massachusetts, Oregon, and Arizona are being pursued in 2019.
Transformational Acquisitions
The Company is pleased to announce that it has entered into binding LOIs to acquire 100% ownership in a series of companies that will have a transformational impact to IONIC BRANDS’s operations, premium brand and portfolio of products.
| COMPANY | STATE | KEY ASSETS | DESCRIPTION |
| Zoots (“Zoots”) | WA | Cannabis-infused edibles company | A Washington-based edibles company, a first major player in the cannabis-infused edibles market. Zoots products are being sold in Washington and Colorado. Zoots is forecasting 2019 sales revenues to be USD $6 million in topline revenue and $780,000 in EBITDA cash flow. Zoots has a proven marketing system and sales team. IONIC will pay USD $11 million, comprised of USD $600,000 in cash and USD $10.4 million shares of the Company, issuable upon closing of the transaction and the price per IONIC Share shall be calculated by reference to the 10-day volume weighted average price of the Company’s shares on the Canadian Securities Exchange. |
| Vegas Valley Growers (“VVG”) | NV | Revenue-generating integrated operations; Cultivation license; Volatile & Non-volatile Extraction license; Cross-Jurisdiction (Distribution) License; and the “M” Branded Vaporizer Pen |
The Company has a definitive agreement to purchase Vegas Valley Growers (“VVG”), currently a revenue-generating vertically integrated operations in Las Vegas, Nevada, with full complement of production, manufacturing and distribution licenses. VVG operates in a 1,700 square foot production facility, situated on 3.42 acres of land. VVG is currently building out a 70,000 square feet manufacturing facility with expected completion date of June 2019. A second 65,000 square feet facility is planned for H2-2019. In 2018 historical revenues were USD $2.56 million with USD $600,000 EBITDA. VVG’s “M” Branded Vape Pen has a current market penetration into 80% stores in Nevada. The Company expects to add various Ionic product SKUs to VVG's existing distribution pipeline and believes this can result in an increase to sales. The total purchase price is CAD $22.8 million, comprised of CAD $1.65 million paid in cash and CAD $21.15 million shares of the Company. The number of shares issuable will be upon closing of the transaction and the price per IONIC Share shall be calculated by reference to the 10-day volume weighted average price of the Company’s shares on the Canadian Securities Exchange. The Company has an option to purchase the entire real estate package for USD $11 million. |
| WW Agriculture (“WWAG:) | WA | Cultivation farm | An Eastern Washington cultivation farm that will enable the Company to control the supply chain and reduce the cost of cannabis concentrate oil production to less than USD $0.10 per gram. The total purchase of WWAG is USD $2.75 million, comprised of USD $2 million cash to be earned over a two-year period and USD $750,000 in shares of the Company. The number of shares issuable will be upon closing of the transaction and the price per IONIC Share shall be calculated by reference to the 10-day volume weighted average price of the Company’s shares on the Canadian Securities Exchange. |
| Vuber Tech (“Vuber”) | WA | Hardware Products and Intellectual Property (patent-pending core cartridge and patent-pending pulse batter; and 11 provisional patents expected in 2019) |
Vuber is a revenue-generating vaporizer hardware company. Vuber has 2019 forecasted revenues of USD $8 million in revenue and $720,000 in EBITDA cash flow. The total purchase price of Vuber is USD $12.5 million, comprised of USD $2.5 million in cash and USD $10 million in shares of the Company. The number of shares issuable will be upon closing of the transaction and the price per IONIC Share shall be calculated by reference to the 10-day volume weighted average price of the Company’s shares on the Canadian Securities Exchange. |
Acquisition of Cannabis-Infused Coffee Patents
IONIC BRANDS, above all else, values its brand strategy as its core business. However, acquiring certain strategic intellectual assets, especially strong patents that support future products such as coffee and tea beverage products, are paramount to supporting our brand pillars, to develop our core business strategy and deliver strong shareholder value. The Company is proud to be able to have acquired some of the first cannabis patents ever granted by the United States Patent and Trademark office. IONIC BRANDS acquired two patents from Canna Cafe. The first patent is related to any cannabinoid infused into coffee, and a second patent relates to any coffee infused with a cannabinoid into coffee in a Keurig ® K-Cup ® Pod. These patents are granted in the US market only. A third international patent is in process for cannabis-infused teas.
IONIC Management Team
The IONIC BRANDS senior executive team, led by John Gorst, has a successful track record of building companies.
CEO & Chairman, John Gorst. Mr. Gorst has built, led and sold four different technology companies with market valuations in excess of $600 million. Mr. Gorst has been at the forefront of IONIC’s expansion and development into Washington’s leading vaporizer brand.
President, Vice-Chairman and Co-Founder, Andrew Schell. Mr. Schell has built several successful companies and was most recently a CEO of a US Department of Defense company specialized in military operations. Mr. Schell has an engineering background rounded in operations, strategy and contract law.
Chief Marketing Officer and Co-Founder, Christian Struzan, has over 30 years of experience in marketing and branding in the entertainment and consumer goods industries. Mr. Struzan founded an advertising agency which developed and executed marketing campaigns for feature films including: the Star Wars franchise, Fight Club and television series American Idol, as well as working on global brands such as Guinness, Stella Artois and Beck’s.
Chief Revenue Officer, Johnny Stange. Mr. Stange was formerly a Director of Sales for the Southern California region for Treasury Wine Estates, a major wine wholesaler where he grew and oversaw annual sales of $250 million. Mr. Stange is leading the charge IONIC’s aggressive sales growth plans across multi-states.
“We are excited that IONIC BRANDS is listed on the Canadian Securities Exchange. This is a critical step in the Company’s growth plans. IONIC BRANDS is embracing the North American opportunity, supported by the Canadian investment community. We look forward to the access of the capital markets to build IONIC BRANDS and our premium brand portfolio” says John Gorst, CEO & Chairman of IONIC BRANDS.
About IONIC Brands Corp.
IONIC Brands Corp is an award-winning Washington State-based premium cannabis concentrate company. The Company is a multi-state operator that manufactures, brands and distributes premium cannabis concentrate products throughout the West Coast of North America. IONIC BRANDS is focused on extracting value for shareholders through a refined strategy of iconic brands and a proven execution strategy. In 2018, IONIC was voted one of the Top 50 Companies to Work for in Cannabis by MG Magazine, a publication serving cannabis industry professionals.
ON BEHALF OF THE BOARD OF DIRECTORS
“John Gorst”
John Gorst
Chairman & CEO
For inquiries, please visit www.ionicbrands.com, by email info@ionicbrands.com or call investor relations at 253-248-7920 (option 4).
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