From the house of Savanna Dry and Klipdrift, leading wine, cider and spirits company Distell have announced a 20% stake in a cannabis wellness business, RETHINK, with cannabidiol-infused drinks soon to hit the South African market.
The new RETHINK partnership between Distell and Invenfin, a growth capital investor, is set to bring together a set of complementary products, branding and commercial capabilities to build a cannabis alcohol brand in South Africa and other markets.
The investment gives Distell access to RETHINK’s brand and product range, including oils, capsules and teas made from CBD, a chemical compound found in the cannabis plant gaining popularity for its uses and benefits from relaxation to skincare.
Distell CEO Richard Rushton says the investment allows the company to explore expansion opportunities and benefits following the increased demand of cannabis products like CBD.
“The cannabis sector (in South Africa) is still in its infancy and primed for growth as legislation to control and legalise certain aspects of usage is developed,” says Rushton.
“Our investment into the RETHINK brand in partnership with Releaf Pharmaceuticals and Invenfin is a great fit with Distell’s strategy to explore new growth opportunities.
“We will bring our existing supply chain and marketing expertise to help grow RETHINK and collaborate with stakeholders to build this emerging sector with significant economic potential for South Africa.”
CBD is one of a variety of compounds found in the cannabis plant, but studies have found it does not cause a “high” or produce effects that could lead to addiction, says the World Health Organisation.
The price tag for Distell’s stake in RETHINK, created by herbal and organic pharmaceuticals firm Releaf Pharmaceuticals, was not disclosed in a media release issued moments ago. Invenfin, the venture capital arm of Distell’s largest shareholder, Remgro, also took a 20% share in RETHINK.
Distell is currently grappling with the impact of the Covid-19-enforced sales ban on alcohol in Mzansi – the third ban since March last year as the country grapples with rising coronavirus infections. However, hefty investments made in prior years have helped its recovery, it said last year.
It has been legal to sell CBD products in South Africa since 2019.