Vape company Ispire goes public in the US; Layn Natural Ingredients allotted $1.5 million in shares
On April 4, the US capital market welcomed a new stock, Ispire (ISPR), a company engaged in e-cigarettes and vaporizing CBD. This is a company with Chinese shareholders, registered in the US, with future production bases in Southeast Asia and the US.
On February 17 of this year, Ispire officially began its IPO process, with Tiger International, Tianfeng International, and Puyin International as its joint underwriters. The choice of underwriters also reflects a typical Chinese characteristic.
ISPR plans to issue 6 million shares of common stock, with an offering price between $6 and $8, expecting to raise between $36 million and $48 million, with the final price set at $7.
The prospectus shows that before the IPO, the shareholder structure of Ispire included Liu Tuanfang and Zhu Jiangyan, who together held 71.5%, while Liu Yuli held 5%. Ispire Technology is headquartered in Los Angeles, California, USA, and is engaged in the research, design, and manufacturing of branded e-cigarettes and cannabis vaporization products, commercializing its products through direct sales and distribution. It has two main product categories: Aspire tobacco product type e-cigarettes and “ISPIRE” cannabis e-cigarette hardware products. The sales regions do not include China and Russia.
Ispire was established on June 13, 2022, and went public in less than a year. However, the story behind this is not so simple; founder Liu Tuanfang has been involved in the e-cigarette industry for many years and is one of the leaders in the domestic e-cigarette industry. However, to facilitate the IPO, he registered a company in the US.
Inspire Tech has two operating units—Aspire North America LLC, a California limited liability company, and Aspire Science and Technology Ltd., a Hong Kong company.
The funds raised from this issuance will be used to complete the investment and construction of production lines in Vietnam and California, USA, to continuously enhance R&D capabilities, including the reserve and development of the next generation of vaporization products and vaporization technology; and to further strengthen the global terminal channel network construction for its own brand.
From the above description, it is evident that ISPR is a US-registered company currently conducting business through two overseas companies, with future production bases also overseas. This company has separated its operations from China, thus avoiding the need to go through Chinese legal reviews. According to the latest regulations in our country, domestic e-cigarette companies must obtain approval from the tobacco regulatory authority to go public.
Inspire's total sales revenue last year was $88.095 million, a year-on-year increase of 38.9%; among which, for the fiscal year 2021-2022, the revenue from the CBD vaporization segment increased from $2.144 million to $19.978 million, with a year-on-year growth rate of 831.8%; the revenue from open vaporization devices and components (users inject their own e-cigarette e-liquids) increased from $61.271 million to $68.117 million, with a year-on-year growth rate of 11.2%. Among the two major business lines, the CBD vaporization segment accounted for about 22.7% of revenue in the 2022 fiscal year, an increase of 19.3 percentage points year-on-year.
This IPO prospectus shows that the company's cannabis vaporization products (under the “Ispire” brand) are mainly developed through ODM methods. Currently, cannabis vaporization product sales are concentrated in the US and are gradually expanding to Canada, Europe, and other regions. The Ispire management team has extensive experience and industry resources in the e-cigarette and cannabis vaporization fields, with over 200 authorized patents globally. Ispire is committed to the R&D innovation of e-vapor devices and has led several waves of technological transformation in vaporization devices.
The company's industrial hemp project was officially put into production in 2022, and an industrial hemp R&D center was established to conduct research and development of processes, applications, and formulations related to industrial hemp. This factory has achieved automated extraction production and has been listed as a demonstration project in the field of industrial hemp extraction by the Indiana state government.
According to previous reports from Securities Times, the industrial hemp project has seen rapid growth this year.
Vaporization products are an important application area for industrial hemp. According to Frost & Sullivan research data, from 2018 to 2022, the global e-vapor device market size has an annual growth rate of 18.1%, and it is expected to maintain a growth rate of around 18.5% from 2022 to 2027.
Recently, Rhine Bio (002166) announced that on April 4 (US time), the company used its own funds of $1.5 million to acquire 214,285 shares of Ispire in its NASDAQ IPO, with an issue price of $7/share. Participating in this strategic allocation of Ispire's IPO is beneficial for both parties to deepen cooperation in industrial hemp-related businesses, combining their respective sales channels, customer bases, and raw material supply advantages to promote resource sharing and industrial synergy. #p#分页标题#e#
Ispire closed its first day of trading at $7.55, up 7.86%, with a market capitalization of $400 million. The latest market capitalization is $375 million.
