The Fiji Kava Ltd (ASX: FIJ) share price flew higher today and is up by 71.88% at the time of writing to 28 cents. This came after the company announced that it had landed a partnership to supply its medicinal products to China.
What was in the announcement?
According to Fiji Kava, it signed an agreement with PuMate (Shanghai) as its authorised distributor to supply the company's medicinal products to China. Fiji Kava stated that the landmark agreement includes a minimum sales requirement of $8 million over the initial 3-year term of the agreement.
The agreement is extendable for periods of 12 months each after the initial 3-year term. If PuMate reach a target of $10 million in annual gross revenue, Fiji Kava have agreed to issue the distributor 1.5 million options at a discount of 15% to the 30-day volume weighted average price, subject to shareholder approval.
Fiji Kava stated that the agreement includes diversified distribution channels into China with both branded Fiji Kava products and raw Noble Kava extracts to be sold in China's complementary medicine, personal care and pharmaceutical industries as well as through e-commerce marketplaces.
Fiji Kava non-executive director Nicholas Simms stated: "This agreement has been structured in a way that diversifies our revenue streams in China via co-development possibilities with manufacturers of vitamins and supplements in China, and sales of Fiji Kava's existing product ranges through cross-border eCommerce marketplaces and retail partners."
According to the announcement, China's vitamin and supplement market is worth $30 billion per year.
About the Fiji Kava share price
Fiji Kava is an Australian-Fijian company that produces 'noble kava' products for the complementary and alternative medicine market. Its products are TGA and FDA compliant. Fiji Kava has been listed on the ASX since 2018.
Earlier this month, Fiji Kava announced that it had signed a major agreement with a subsidiary of Blackmores Limited (ASX: BKL), BioCeuticals. Under the agreement, BioCeuticals will have a licence to add Noble Kava produced by Fiji Kava to its AnxioCalm product.
The Fiji Kava share price is up 865% since its 52-week low of 2.9 cents and up 358% since this time last year.
