Kadenwood LLC, a company that manufactures and sells cannabidiol (CBD) as a lifestyle product, announced Wednesday that it will acquire Colorado-based EcoGen Laboratories, a major producer of hemp-derived CBD.
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The acquisition, according to Kadenwood, "effectively establishes Kadenwood as the largest supplier of vertically-integrated, hemp-derived" CBD in the United States. CBD is a non-intoxicating extract from hemp, which can also be derived from cannabis, and is often used to treat conditions like anxiety and chronic pain.
Kadenwood is valued at about $180 million, and with EcoGen added to its portfolio will increase to approximately $250 million, according to Kadenwood.
EcoGen ran into financial troubles due to the coronavirus pandemic, laying off more than 100 workers in recent months, according to The Daily Sentinel of Grand Junction, Colo. Prior to the pandemic, the company had grown to more than 200 employees. Earlier this year it was beginning to develop operations in a 20-acre property that was formerly the Grand Junction Steel building, according to The Daily Sentinel.
According to Kadenwood, it is appointing several officers to EcoGen's executive team who will "focus on strategically scaling the staff and business operations supporting EcoGen’s sales, manufacturing and processing capabilities" in Grand Junction.
"We’re committed to improving not just our brand, but the perception of our industry overall, and that starts with ensuring consumers have access to quality CBD products they can trust,” said Erick Dickens, the CEO and co-founder of Kadenwood. “EcoGen has maintained a commitment to producing sustainable and consistent CBD and we’re happy to bring them under the Kadenwood brand as we expand our offering of exceptionally pure CBD products that continue to set the industry’s standard of quality."
Former U.S. Surgeon General Richard Carmona is on the board of Kadenwood. Carmona also ran for Senate as a Democrat in Arizona in 2012, narrowly losing to former Republican Sen. Jeff Flake.
Kadenwood said demand for CBD is increasing after the industry took a hit from the pandemic, and the CBD industry has been growing since Congress passed the Farm Bill in 2018 that explicitly legalized CBD nationwide -- the market for CBD about doubled between 2018 and 2019.