By CHRIS MELLIDES
Turning Point Brands (TPB), owner of the Zig-Zag cigarette paper brand, announced Thursday that it would be purchasing online vapor product company VaporBeast for approximately $27 million.
The deal was signed with both companies agreeing to an immediate acquisition with the big-ticket transaction expected to close before the end of the year.
VaporBeast is a leading e-commerce platform and retail distributor of various vapor products including a wide variety of brand name hardware and e-liquid that was launched five years ago by founder Tim Campbell.
Campbell’s decision to sell his company, which brought in a reported $53.2 million of revenue during a 12-month period ending Sept. 30, claimed that he’s excited at what lies ahead for VaporBeast and that joining with TPB will allow VaporBeast to “continue to grow…amid the evolving regulatory environment.”
“TPB’s regulatory expertise and nationally recognized sales force offer unique elements of capability to ensure and promote our future success,” Campbell said.
TPB operates in three segments: smokeless products, smoking products, and new generation products, the latter being an appropriate category for VaporBeast and the products it’s been known to offer to its huge customer base and to more than 4,700 non-traditional retailers.
Aside from Zig-Zag cigarette papers, TPB also owns Red Cap pipe tobacco, Stoker’s moist snuff and a number of chewing tobacco companies including Beech-Nut, Durango and Trophy.
The large tobacco entity plans to introduce its own products to VaporBeast’s customer base, while utilizing VaporBeast’s e-commerce platform to distribute products not offered in traditional retail to a portion of TPB customers.
“We have been investing in our sales distribution into the fast-growing non-traditional retail channels and VaporBeast clearly allows us to dramatically accelerate that effort with significantly less resources,” said TPB president and CEO Larry Wexler.
The VaporBeast purchase was the second acquisition carried out by TPB. The first was the purchase of four chewing tobacco brands and a twist tobacco brand from Wind River Tobacco Company for approximately $2.5 million.
“Both acquisitions highlight our strategy to buy attractive brands and assets within a fragmented Other Tobacco Products (OTP) market on an accretive basis,” Wexler said. “We intend to grow the value of these assets by applying our OTP experience, best practices and core competencies—including our national distribution infrastructure, salesforce, brand experience, product development and regulatory infrastructure.”
Chris Mellides is the Managing Editor of VAPE Magazine. A seasoned journalist, he has worked in all areas of the media industry since first getting his start in newspaper reporting ten years ago. Contact him at firstname.lastname@example.org.