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Compass Diversified Holdings to buy Fresh Hemp Foods

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Staff writer | Wednesday June 10, 2015 2:30AM ET
Manitoba Harvest
Acquisition   The fastest growing in the hemp food market

Compass Diversified Holdings (CODI) entered into an agreement to acquire Fresh Hemp Foods (Manitoba Harvest). The acquisition is expected to close in the next 45 days, subject to customary closing conditions.

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Headquartered in Winnipeg, Manitoba, Manitoba Harvest's products are the fastest growing in the hemp food market and among the fastest growing in the natural foods industry. Manitoba Harvest's products are currently carried in about 7,000 retail stores across the U.S. and Canada.

For the year ended November 30, 2014, Manitoba Harvest reported net revenue of approximately C$37.9 million, an increase of 23.9% year-over-year. The company continued its rapid growth in the first half of its current fiscal year, generating net revenue of approximately C$27.6 million for the six months ended May 31, 2015.

The purchase price for Manitoba Harvest is based on a total enterprise value of C$132.5 million and will also include working capital and certain other adjustments upon closing.

Manitoba Harvest generated net revenues of approximately C$44.9 million and Adjusted EBITDA of approximately C$6.4 million for the last twelve months ending May 31, 2015, representing year-over-year growth of 28.5% and 59.4%, respectively. The company generated Adjusted EBITDA for the six months ended May 31, 2015 of approximately C$5 million.

CODI's initial equity ownership in Manitoba Harvest as a result of the transaction will be approximately 87% on a primary basis. Mike Fata, CEO of Manitoba Harvest; Clif White Road Investments LLC, an existing shareholder; and certain other management team members will re-invest alongside CODI.


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