Functional beverage brand Life On Earth has acquired Los Angeles-based The Chill Group, makers of natural relaxation drink line Just Chill.
According to a Form 8-K filing with the U.S. Securities and Exchange Commission (SEC), the deal, completed on August 2 and announced in a press release yesterday, is a common stock purchase agreement for 100 percent of The Chill Group, Inc.
Just Chill, founded in 2010 by Max Baumann, is a natural functional beverage formulated with L-theanine, an amino acid that can promote relaxation and facilitate sleep. The line is available in four flavors and is sold in retailers such as Whole Foods (Southern California), Kroger and H-E-B.
Just Chill joins Latin drink brand Gran Nevada and Victoria’s Kitchen almond water in Life On Earth’s beverage portfolio. Speaking with BevNET, Life On Earth president JC Romagosa said the company was introduced to Just Chill through its relationship with David Meniane, a shareholder in Victoria’s Kitchen and the executive vice president of Coca-Cola Co.-aligned beverage incubator L.A. Libations, which has worked with The Chill Group since 2012.
Romagosa said he recognized Just Chill as an innovative natural and organic product and “potentially high profile brand” that matched Life On Earth’s strategic approach to beverage. He noted that the company’s first goal will be to shore up its current business, introduce the product into new markets, and integrate a grassroots marketing program.
“One of the things we see about Just Chill that we feel strong about is that lots of brands that come out can fall into specific niches or categories,” he said. “It has wide appeal: you could see the brand being inside a 76 gas station or a 7-Eleven, but also at a Whole Foods or Bristol Farms.”
Under the terms of the deal, Life On Earth CEO Fernando Leonzo will be appointed president of The Chill Group. Basemakers, the marketing and merchandising company owned by Baumann, will also represent all Life On Earth portfolio brands at a discount for two years.
Romagosa noted that Baumann could fit into an advisory position in the future, but that he had not yet been offered a formal role. L.A. Libations is also now a shareholder in Life On Earth, though Romagosa said that the latter is not “actively engaged with [L.A. Libations investor] Coca-Cola directly.”
In a press release announcing the deal, Leonzo noted that Just Chill will be able to leverage the company’s marketing, distribution, sales and R&D divisions to grow the brand. He also indicated that further acquisitions could follow in the near future.
“Once again we have demonstrated the speed at which we’re able to identify, target and acquire hot emerging brands and fold them into our growing portfolio of healthy functional beverages,” said Leonzo. “We are continuing to interview other emerging beverage brands like Just Chill who can benefit from our accelerator infrastructure.”