NewAge Beverages facility sold off under Chapter 11 plan
NewAge Beverages’ Colorado facility will be sold off under a proposed Chapter 11 Plan of Liquidation.
Filed on November 30th, the sixty-one page document details NewAge’s Chapter 11 bankruptcy restructuring plan.
NewAge itself, Ariix and Morinda remain intact, however NewAge Beverages will be sold off Legacy Distribution Group for $4.5 million.
This is from NewAge’s proposed Chapter 11 Plan of Liquidation;
NewAge is the parent company of two wholly-owned, non-Debtor subsidiaries, NABC, Inc. and NABC Properties, LLC (the “NABC Entities”), which operate together as a direct store distribution business providing beverages, snacks and other products to grocers, big box retailers and convenience stores (the “DSD Business”).
The DSD Business operates in Colorado.
NewAge Beverages isn’t named but I believe, based on the business model description, is the referenced “DSD Business”.
On November 11, 2022, the Debtors filed a Motion for Entry of an Order (I) Authorizing the Debtors to Effectuate the Sale of Property of NewAge’s Wholly-Owned, Non-Debtor Subsidiaries, (II) Authorizing the Assumption and Assignment of a Lease, and (III) Granting Related Relief (the “DSD Sale Motion”).
The DSD Sale Motion sought approval of the sale of the DSD Business to Legacy Distribution Group, LLC (“Legacy”) with a purchase price of $4,500,000, subject to net working capital adjustments as further described in the APA attached to the DSD Sale Motion.
The DSD Sale Motion also sought to assume and assign one of NewAge’s commercial leases to Legacy, located at 18245 East 40th Avenue, Aurora, Colorado 80011.
NewAge’s motion was granted on November 23rd.
Legacy Distribution Group is owned by Canadian corporation CBD Global Sciences (dba Global Sciences).
As per a September 9th press-release;
The New Age DSD operation has been serving the Colorado community for over twenty years, providing best-in-class service to over 5,000 outlets, and has been responsible for launching and growing some of the biggest brands in the industry.
From humble beginnings to becoming what is believed by New Age, Inc. as “one of the largest independent distributors in the country”, the DSD now employs hundreds of employees and is proud to keep this great “Legacy” alive.
Brad Wyatt, CEO of Global Sciences shared, “This is a positive achievement for both Legacy Distribution Group and the Operations Team at the DSD.
Our companies have been aligned in the Colorado market with the desire to serve the vendors and stores with best-in-class service.”
The reason I’ve picked this out of NewAge’s Chapter 11 plan as being of primary significance, is the Colorado bottling facility is core to its MLM business’ product distribution.
Prior to Chapter 11 proceedings, NewAge and Global Sciences have an existing business relationship dating back to at least 2020.
Although not disclosed, I’m assuming there’s a business deal in place to ensure NewAge, Morinda and Ariix are able to continue to push products through the Colorado facility.
Outside of the NewAge Beverages facility being sold off, the rest of the Chapter 11 plan contains disclosures we’ve already covered. Namely what lead up to the bankruptcy, including alleged sabotage and extortion.
Looking forward, NewAge’s Chapter 11 Plan of Liquidation needs to be voted on, after which the court will either confirm or reject it. This process will extend into Q1 2023.
Update 3rd March 2023 – NewAge has consolidated its MLM companies and rebranded as PartnerCo.