USA – Arizona Beverages, producers makes Arizona Iced Tea, has partnered with cannabis company Dixie Brands to produce marijuana-infused products containing tetrahydrocannabinol (THC).
Arizona Beverages signed a three-year licensing agreement with Dixie Brands that will see Dixie manufacture and distribute the THC-infused products branded under the AriZona name.
Dixie, which operates in six US states, currently produces a range of cannabis-infused chocolates, gummies and elixirs. The deal gives AriZona the right to buy a stake of up to US$10 million in Dixie.
Arizona Beverages will introduce vape pens and gummies and later the company plans to expand to other lines like tea, lemonade, soda, coffee, and seltzer.
Herbal Enterprises, an affiliate of Arizona Beverages, will provide the conceptual design for the products during the tree year partnership, with an option to renew for up to two additional terms of two years each.
“The cannabis market is an important emerging category, and we’ve maintained our independence as a private business to be positioned to lead and seize generation-defining opportunities exactly like this one,” said Don Vultaggio, chairman of AriZona Beverages.
“The cannabis category is an ideal space to bring the flavour and fun of AriZona into new and exciting products.
“We selected Dixie Brands as our partner to bring these products to market after touring their best-in-class manufacturing facilities, and spending considerable time building a strong relationship with their management,” he added.
Dixie Brands chief executive Chuck Smith added: “AriZona is a power brand and the most iconic and recognized CPG brand to extend into the cannabis market, providing the evolving cannabis consumer with a fun and flavorful experience alongside an iconic brand they know and love.
“For nearly a decade, Dixie Brands has crafted award-winning cannabis-infused products, creating some of the most recognised and trusted brands in the industry, and we are thrilled to have found a partner that shares our values.
“This partnership marks a watershed moment for the popularisation and expansion of the cannabis sector overall, and is another large step forward for Dixie Brands’ strategy to build a house of famous cannabis CPG brands.”
However, although marijuana is legal for recreational use in 11 states and for medical use in more than 30 states in US, it remains prohibited by federal law.