Health Sciences Group in deal to buy red tea maker
October 16, 2006
by Eric Schroeder
LOS ANGELES — Health Sciences Group, Inc., a provider of health and wellness products, has signed a letter of intent to acquire the business and assets of Kalahari Ltd., a specialty tea and food company. The move, which is expected to close Nov. 30, marks the first acquisition under the leadership of Health Sciences Group’s new chief executive officer Stuart Gold.
"With research touting its high level of antioxidants and related good health benefits, I believe red tea is poised for mainstream consumer acceptance and will become the next hot tea trend," said Mr. Gold, who plans to redesign, renew and expand the product line, as well as open new marketing channels and licensing opportunities.
According to a report by the Sage Group, a market research firm, the U.S. tea market is valued at $6.8 billion and is expected to reach $10 billion by 2010. Of that, specialty teas, which include Red Tea, account for $1.5 billion, with sales projected to grow at a rate of 20% annually.