The parent company of Arizona Iced Tea has decided to expand its business by getting into the marijuana market. Arizona is still the leading ice tea brand by sales volume, but its market share has steadily fallen in recent years. Arizona Beverage Co. reached a licensing deal with Denver-based Dixie Brands Inc, a cannabis company.
Dixie will make the products for Arizona and sell them through licensed dispensaries. The deal still has to be approved by Dixie’s board. If approved, Arizona will also have the option to buy a stake of up to $10 million in Dixie.
The small, privately-owned Arizona is trying to get a head start in the cannabis market over larger beverage makers. Some larger companies are developing marijuana drinks in Canada, but are waiting for federal legalization in the US before starting to sell here.
Arizona plans to expand its marijuana business to Canada and Latin America.