Jones Soda has pulled the plug on a planned merger with Vancouver-based portfolio company Simply Better Brands Corp. (SBBC), citing “current market conditions” as the reason.
“We are disappointed that due to current market conditions we are unable to move forward with our intended transaction at this time,” SBBC CEO Kathy Casey said in a press release. “The Jones Soda brand is one we felt confident would add tremendous value to our existing platform and ultimately be accretive to shareholder value. We wish Jones management and their board much success in their future.”
SBBC previously agreed to purchase Jones Soda in April for roughly $99 million through an acquisition of all issued and outstanding Jones common stock at 75 cents per share based on a price per SBBC share equal to $3.65. Jones CEO Mark Murray and chairman Jamie Colbourne were set to join the combined company’s board of directors.
SBBC is a portfolio company focused on plant-based wellness and its brands include plant protein bar TRUBAR, CBD oil and gummies producer PureKana, and cosmetics line No B.S.
The merger with Jones would have further expanded its presence in the cannabis space via the soda maker’s recent expansion into THC-infused products via the Mary Jones line of edibles, sodas and syrups. The Mary Jones line was initially set to launch in California dispensaries in March, but was delayed due to supply chain disruptions.
In the press release, Murray said Jones and SBBC “will continue to find successful business opportunities in the future, despite this shift in direction for both companies.”
During Jones’ Q1 earnings call last month, Murray stressed that the merger was “still only a binding [letter of intent] and there’s still a lot of work to be done” and noted that the company had a team working on due diligence.
During the call’s Q&A portion, he noted that Jones hoped to leverage SBBC’s established presence in the CBD category to further extend the soda brand into the cannabis space. Despite the setback in the Mary Jones launch, Murray said on the call that the company has worked over the past several months to fortify core operations with new manufacturing, distribution and emulsification partners to improve supply chain. As well, the company is working with potential partners in New York, Michigan and Canada to launch Mary Jones in new regions, but there are no definitive plans to expand the line as of yet.
Murray was unavailable for comment today. SBBC did not immediately respond to a request for comment.