Sera Labs, a privately held CBD health-and-wellness company, is about to have new ownership. The Sherman Oaks, Calif.-based company has entered into a memorandum of understanding with Cure Pharmaceuticals for a $20 million total upfront consideration, comprising $19 million in Cure Stock and $1 million in cash, with an additional $4 million in working capital to fuel growth.
“Cure’s acquisition of Sera Labs will add a growing brand portfolio and monetization platform that fits remarkably well with Cure’s development capabilities, products, and existing market verticals,” said Rob Davidson, CurePharmaceutical CEO. “By integrating Sera Labs’ products and processes with those of Cure’s, and leveraging our [current good manufacturing practices] manufacturing facility to realize economies of scale, we will drive improved margins and profitability. This acquisition comes on the heels of our most recent pharmacokinetic study, which showed that our Cureform thin film technology improved cannabidiol bioavailability, and sets the stage for potentially exciting opportunities to apply our innovative dosage forms to Sera Labs’ products. “
We look forward to joining forces with the Sera Labs team as well as Nancy Duitch’s continued leadership at the helm of Sera Labs and as a key member of CURE‘s leadership team upon closing of the transaction.”
The deal to acquire the 2-year-old company also includes the potential for an earn-out of as much as $20 million in Cure Stock at a valuation of $3.34 per share within two years of closing the acquisition if Sera Labs achieves certain financial targets. The companies expect the deal to close by the fourth quarter of 2020. Nancy Duitch, Sera Labs’ founder and CEO, will remain at the helm of the company following the acquisition.
“Sera Labs has quickly become a standout leader in the CBD industry,” said Nancy Duitch, Sera Labs Founder and CEO. “We attribute our success to capturing a broad distribution network that serves major retailers/distributors and consumers with solution-oriented products and value-driven, trusted brands. ... We are confident that with the novel and patented formulation technologies and know-how of CURE, we will be able to accelerate sales growth and achieve consistent profitability much more rapidly than could have been achieved on our own.”