Radiko Holdings has completed its transaction with BioNeva Innovations of Carson City, Sierra Superfoods and DB3 Management.
Steve Gormley, CEO of the Company commented: "This transaction adds significant enterprise value, and furthers our corporate development strategy of acquiring select, highly-profitable value chain investments to facilitate brand growth, enhance margins and bolster cash flow. We appreciate the patience of our shareholders as we worked to finalize this transaction amid COVID-19, and we look forward to reporting our progress as we execute our plan."
Buildings and equipment used for the operation of BioNeva Innovations of Carson City
BioNeva is a cannabis cultivator that holds cultivation licenses issued by the State of Nevada for both medical and recreational cannabis. The fully operational facility consists of 8,250 ft2 indoor cannabis greenhouse situated on approximately one acre of leased land near Carson City, NV. "The facility's flowering canopy is 4,000 ft2 and incorporates a highly efficient roof glazing material, as well as highly efficient auxiliary lighting systems," the team with the company explains.
"Radiko expects BioNeva to harvest an estimated 36-44 KG per month with sales possibly beginning as early as June 2020. The Cultivation Operations are currently managed by DB3, an entity that was acquired by the Company."
Sierra Superfoods which holds hard assets and equipment associated with the BioNeva Cultivation Operations
"Sierra owns the building and equipment used for the Cultivation Operations," they further explain. "There is a 4,250 ft2 facility designed to grow and distribute mushrooms for the culinary trade located within the property which the Company anticipates may be converted to cannabis cultivation at a future date."
Existing management agreements held by DB3 for one cultivation and one cultivation/production facility in Nevada
"In addition to the management of BioNeva, DB3 has a management agreement for an unrelated cannabis cultivation/extraction/production site under development in Washoe County, NV. The Washoe location is designed for a 20,000 ft2 greenhouse with the capacity for approximately 148kg (325 lbs) per month. The Washoe facility is still under construction but is expected to be operational in Q4 of 2020 and generating revenue by Q1 of 2021."
"DB3 has an agreement to receive USD$15,000 per month from its management of the Washoe site (with potential for 30% of net profits). Once operational, Radiko estimates the 20,000 ft2 indoor grow and production/extraction facility under DB3 management should produce between 136-156 kg of premium flower per month while operating a best in class extraction/production lab. "
Bob Yosaitis, a director of the Company and a holder of BioNeva, Sierra and DB3, added: "I am extremely pleased that Radiko and BioNeva are able to join forces and create broader opportunities for both organizations. The Radiko team has extensive cannabis experience and the expertise to build successful operations for both the Carson City [BioNeva] and Washoe locations, and the addition of cultivation should contribute significantly to overall earnings and provide a valuable platform for Radiko's portfolio of brands."
Nevada License Review
The Nevada Department of Taxation, the entity that regulates the cannabis industry in Nevada, announced on October 17, 2019, that it had implemented an extended review process and that it would not be processing any existing or new applications that relate to the transfer of licenses and change of ownership/interests while the extended review is in place. "The acquisition of BioNeva will be completed as soon as practicable following termination of the extended review period," the team concludes.
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