Althea will enter the lucrative US cannabis beverages market. Pic: Getty Images.
Health & Biotech
Special Report: Althea Group says there is an enormous growth opportunity for the company following the establishment of a joint venture between its US subsidiary, Peak USA Inc., and Flora Growth Corporation to enter the burgeoning US cannabis beverages market.
Althea Group (ASX:AGH) says the key strategic agreement capitalises on projected growth in the US cannabis beverage market, currently valued at nearly US$967m and expected to soar to US$19 billion by 2028.
AGH says cannabis beverages containing hemp-derived delta-9-THC are legal nationwide in the US.
The company says the JV will strategically establish cannabis beverage distribution by navigating regulations and accessing consumer-packaged goods channels like wine and liquor stores, instead of state-licensed cannabis dispensaries.
AGH says this approach increases accessibility and broadens consumer reach, maximising market penetration and growth potential.
Peak USA and Flora Growth Corporation have developed six cannabis-infused drinks set to launch in early 2025, including three seltzers and three sodas with varying THC levels for the US market.
The planned JV was announced in May with the deal finalised following AGH’s successful completion of a $2m capital raise from new and existing institutional and sophisticated investors to support its expansion into the US cannabis beverages market.
AGH says formalisation of the JV signifies a major milestone of its wholly-owned subsidiary Peak Processing Solutions (known as Peak Canada) as it expands into the US cannabis beverages market via Peak USA, which has been incorporated to provide in-country services.
The company says with a robust strategy and strong partnership, the JV is well-positioned to seize the significant growth opportunities in this burgeoning market.
AGH says its Peak Canada operation is recognised as a market leader in the contract development and manufacturing of cannabis-infused beverages with a 40% market share in Canada and is strategically positioned to capitalise on the growing US market.
Peak USA will handle production in the US and plans to leverage its Canadian operations to cater to US market needs.
AGH says the company plans to replicate its Canadian success in the US market by manufacturing its proprietary cannabis emulsion Envision from locally sourced hemp, which will be the active ingredient in its US-made cannabis beverages.
Experienced representatives from Peak’s Canadian operations will oversee all aspects of Peak USA’s early US business, ensuring strict adherence to product quality and taste standards.
Peak Canada will also continue to provide product development services from its existing Canadian operations.
AGH CEO and managing director Joshua Fegan says the company is excited to have entered a deal with Flora Growth Corporation, marking a significant step forward in Peak Canada’s expansion into the US cannabis beverages market.
“The JV represents a major growth opportunity for Peak Canada, combining our industry-leading expertise in cannabis beverages with Flora’s expansive distribution network,” he says.
“With the US market projected to grow exponentially, we are extremely well-positioned to succeed.”
This article was developed in collaboration with Althea Group, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any fin
Health & Biotech
Health & Biotech
Health & Biotech
