Compass Diversified Holdings Subsidiary, Manitoba Harvest, Acquires Hemp Oil Canada - C$42M

Compass Diversified Holdings

("CODI" or the "Company"), an owner of leading middle market businesses, announced today that its subsidiary, Fresh Hemp Foods Ltd. ("Manitoba Harvest"), has acquired Hemp Oil Canada, Inc. ("HOCI") for a purchase price of C$42 million, not including working capital and certain other adjustments. Founded in 1998, HOCI is a pioneer and leading bulk wholesale producer, private label packager and custom processor of hemp based food products and ingredients. HOCI offers a broad range of hemp based products, including certified Organic, Kosher, and Halal. The company's recently completed state-of-the-art 35,000 square foot production facility is allergen-free and Food Safety System Certification (FSSC) 2200 certified. For the trailing twelve months ended October 31, 2015, HOCI reported net revenue of approximately C$18 million and EBITDA of approximately C$5 million. CODI funded the purchase price through available cash on its balance sheet. Commenting on the transaction, Alan Offenberg, CEO of CODI, said, "Following our platform acquisition of Manitoba Harvest in July, we are pleased to make this accretive add-on acquisition, which will further drive Manitoba Harvest's already strong growth trajectory. By adding this attractive business, Manitoba Harvest will significantly expand its manufacturing capacity, build out its ingredients business, and grow and diversify its customer base. With a strong balance sheet and considerable financial flexibility, CODI remains well positioned to continue to pursue both attractive platform and add-on acquisitions." Mike Fata, CEO of Manitoba Harvest, stated, "HOCI is a pioneer in the industry and we are excited to work with its management team and experienced staff, as we seek to further accelerate our growth potential. HOCI's leading ingredients and private label business compliments our branded business, making it easier than ever for people to enjoy delicious and nutritious hemp foods at every eating occasion."