Skin Elements Ltd (ASX:SKN) has entered a memorandum of understanding (MoU) with Affinity Energy and Health Ltd (ASX:AEB) to develop a new skincare range.
Affinity’s algae biomass and oils, and cannabis oils will be applied to Skin Elements’ range of natural skin care products to create a new range of algae and cannabidiol (CBD) based products.
The MoU represents a significant opportunity for the two companies to be an early mover in an emerging market.
Initial timeframe of 12 months
The MoU is a non-binding agreement with an initial timeframe of 12 months and the capacity to extend subject to the agreement of both parties.
Affinity will be the exclusive supplier of both algae and CBD oils to Skin Elements.
It produces multiple high-demand algae species at its state-of-the-art algae growing facility in Atlanta which we are actively supplying into key nutraceutical and aqua feed markets globally.
Commercial terms and financial arrangements will be negotiated at an appropriate time as product development initiatives progress.
READ: Skin Elements is well positioned in a growing market
Skin Elements is a growing natural and organic skin care company positioned within a US$130 billion global cosmetic market that continues to trend towards natural products.
Having successfully listed on the ASX in January 2017, Skin Elements is focused on expanding distribution of its products on a global scale.
The company’s natural and organic product range covers three key skin care areas – cosmetic, therapeutic and everyday skin care (sunscreen).
Skin Elements’ executive chairman Peter Malone said: “The development of algae, and cannabis oils, for use in skin care products is an exciting opportunity for our company, and one that we are keen to pursue and maximise.
“We continually strive to deliver the highest quality natural and organic skin care products to our customers, and we look forward to working closely with the team at Affinity to unlock the potential to develop new and enhanced skin care formulations.”