Micro Cap RESEARCH REPORT
Follow Up Report
Speculative Buy Recommendation
September 15, 1999
|
Aqua Vie Beverage Corp.
|
Shares Outstanding:
|
22 Million est.
|
|
|
P.O. Box 6759
|
Estimated Float:
|
16 million shares
|
|
|
191 Sun valley Road
|
Ticker Symbol :
|
AVBC
|
|
|
Ketchum, Sun Valley, Id. 83340
|
Recent Price:
|
$0.75/share
|
|
|
(208)-622-7792 or (619)-839-3687
|
|||
This is our second research report, first “Follow Up” report on Aqua Vie Beverage Corporation. The initial research report on Aqua Vie Beverage Corp. can be viewed at http://www.sterlinginvestments.com/aquavie Additional information on Aqua Vie can be viewed on that report.
Since our original report on Aqua Vie Beverage Corp. the company has made several positive developments in the reintroduction of its product onto the market and in developing a world wide distributorship.
Company Description:
The company is head quartered in Sun Valley, Idaho and produces flavored bottled water products. The company’s products include four lines of functional beverages, including the new, all natural, Hydrators beverage line and the “E line” of nutritionally fortified spring waters. Elixir, Empower, and Ecstasy make up the line of nutritionally specific spring water nutraceuticals. The company also has nonalcoholic wine beverage products made from spring water.
In the early 1990s the Company successfully pioneered, developed, manufactured, and test marketed an entirely new category of beverages called “functional beverages,” made from spring water and “all natural” ingredients. Today, in the rapidly expanding non-alcoholic beverage market, this product remains unique in its defined market niches.
In January of 1995 a group of “insiders” in the company attempted a take over of the company through an involuntary bankruptcy petition. This embroiled the company is a long and drawn out legal battle that finally ended in late 1997. Since emerging from bankruptcy the company has made tremendous strides in the re-establishment of its business, production of product, and establishing new sales distribution channels.
Recent Events:
Management Additions
In early June of this year, Aqua Vie announced that Paul Lundy, Jr. was engaged by the company to assist Aqua Vie in its North American and International Marketing efforts. Mr. Lundy has nearly ten years experience in the beverage industry, including brand management and cooperative marketing with 7-Eleven, Blockbuster Entertainment, and Euro Disney. During his tenure with Coca-Cola, he developed and facilitated, successful brand positioning programs, in Asia and the Pacific Rim. Lundy was previously associated with McCann-Erickson in Europe, Atlanta and Portland, where he developed and implemented promotional strategies for a number of international beverage, entertainment and resort accounts. As managing director of Allied Brands (London, England), he was responsible for the repositioning and launch of Lone Star Beer in Europe, establishing brewing, bottling and distribution networks of independent beverage distributors, and a developing a commissioned sales team. He pioneered the implementation of intranet/internet-based management and real-time sales information systems for international sales.
Product Distributions & Shipments.
Aqua Vie Beverage Corp. had obtained production for its product at the time of the writing of our original report. Since then, production has commenced and product shipments have commenced. In late July of this year the company announced the initial shipments of its products from the company’s bottler, Delifruits SA (Valence, France).
The company has also initiated an advertising campaign, featuring promotional spots on Howard Sterns radio show.
Barhill Acquisition Corp. Merger
On August 31st, Aqua Vie announced an agreement to merge with Barhill Acquisition Corp. (an Exchange Act fully reporting company), and the timely filing of an 8-K with the Securities and Exchange Commission (SEC) describing the
merger. Aqua Vie has elected successor issuer status under Rule 12g-3 of the Exchange Act. As a result, the common stock of Aqua Vie Beverage Corporation has resumed trading on the OTC Bulletin Board under the symbol “AVBC.”
The aforementioned 8-K (accession number: 0001021432-99-000118) will be available through the SEC’s EDGAR system. The initial 8-K, filed on September 1, 1999, will be followed by an amended 8-K, which will contain audited financial data and presumably, other detail not previously provided.
Aqua Vie was one of dozens of companies whose symbol had been designated with an “E” following notification by the NASD in early August that such companies were slated for relegation to the “Pink Sheets” as of September 2, assuming a failure to comply with NASD rules requiring that all companies traded on the OTC Bulletin Board be fully reporting. Aqua Vie, which achieved compliance through the aforementioned merger and election under Rule 12g-3, is one of very few of those companies whose stock remains trading on the Bulletin Board. Aqua Vie was also the only one of the designated group that chose the merger/successor issuer election method of compliance.
Our Analysis:
Since the publication of our original report on Aqua Vie Beverage Corp. it has expanded the production of its products, and is now successfully selling ts bottled water over the internet. The company has also been able to successfully attract additional management talent to the company.
The merger with Barhill Acquisition Corp. brought the company into compliance with the NASD Reporting Requirements. This demonstrates management’s commitment to it’s shareholders.
Aqua Vie Beverage Corp. has embarked on the difficult process of re-launching a company and product line that was temporarily placed on hold due to a take over attempt several years ago. While Aqua Vie Beverage still has a difficult task ahead of itself in attempting to gain widespread distribution of its products, it appears that the current management of the company is taking the correct steps to properly position the company to accomplish these tasks.
Our Recommendation:
Sterling Investment Services is continuing to maintain a “Speculative Buy Rating” on the shares of Aqua Vie Beverage Corp. ‘AVBC’.
Disclaimers:
Sterling Investment Services, Inc. is an independent research and investment management firm. Sterling Investment Services, Inc. did receive compensation in the form of approximately $1,500 cash for the production of this research report. Subsequent cash payments to Sterling Investment Services, Inc. may be made in relationship to this report. These future potential payments are currently of an undetermined amount. Sterling Investment Services, Inc. publishes 3 daily newsletters. You are invited to sign up for a free trial offer to any of our services listed below.
The Sterling Investments series of newsletters is produced by Sterling Investment Services, Inc. If you would like to receive a chart on any index or stock mentioned in this report please contact us at the below mentioned numbers. We also offer custom research reports on any stock investment that you may desire information on. To receive further information on these services please visit our web page at: www.sterlinginvestments.com If you would like to contact us our # is 800-275-6901, fax # (404)-816-8830 Email address is: enelson@sterlinginvestments.com Sterling Investment Services may hold positions in the securities recommended or may be providing consulting services to the companies mentioned within this report.
Copyright 1999 Sterling Investment Services, Inc.
PO Box 191767, Atlanta, GA. 31119
Fax 404-816-8830