Cure Pharmaceutical on Tuesday announced it will acquire privately held Sera Labs in Sherman Oaks for $20 million.
Oxnard-based Cure, a drug delivery developer which trades on the over-the-counter market, said the $20 million will consist of $19 million in Cure stock at a valuation of $2.75 per share and $1 million in cash. An additional upfront commitment of $4 million will help accelerate Sera Labs’ growth, the company said.
The transaction has an earn out potential too, at a valuation of $3.34 per share within two years of acquisition closure; this is contingent on Sera Labs meeting financial targets, Cure said.
Sera Labs will continue to build its retail and direct-to-consumer business model with more than 20 products in health and wellness, beauty and pet industries.
“Our acquisition of Sera Labs will add to Cure a growing brand portfolio and monetization platform that fits remarkably well with Cure’s development capabilities, products, and existing market verticals,” Rob Davidson, chief executive of Cure, said in a statement. “We look forward to joining the forces of the Sera Labs and Cure teams and to 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.”
Duitch, who founded Sera Labs in 2018, established the company as a leader in the CBD sector. The company’s net sales totaled $1.8 million for the quarter ended June 30.
Shares of Cure (CURR) closed Tuesday unchanged at $1.65 on the over-the-counter market.