CannaPharmaRx's offer has been accepted to purchase the facilities, as well as certain assets within and/or related to such facilities, including the title to related fee simple lands required for the cannabis cultivation and production business located at, and operated out of, Sasksatoon, Saskatchewan. As previously disclosed, CannaPharmaRx announced a similar acceptance of another offer with facilities located in Cremona, Alberta.
Both facilities are scheduled to close, subject to certain closing conditions, including satisfaction of due diligence and board approval, in the first quarter of 2021. CannaPharmaRx will purchase the facilities free and clear of all encumbrances, other than those agreed to by the CannaPharmarx.
"The 97,000 square foot facility has the capability to produce 4,000 kilograms per year, focusing on medical dried flower sales as well as extract and products pursuant to Health Canada licenses," CannPharmarx team explains. "The facility is a fully operational cultivation, extraction and R & D entity that also contains space leased to its genetics partnership. The purchase price of 12,000,000 (subject to standard closing adjustments) will be paid as to $6,000,000 at closing and the balance in tranches of $3,000,000 upon CannaPharmaRx securing the required cultivating license and then processing license from Health Canada, respectively, in respect of the cannabis related activities upon the closing of this transaction to be carried on at the facilities and for which CannaPharmaRx. As with the Cremona facility, funds required to satisfy payment of that portion of the purchase price that is payable at closing is expected to be funded pursuant to the commitment letter previously announced on January 19, 2021 and to be secured by the facilities."
"We couldn't be happier to have had our offer accepted in order to acquire a second turn-key facility from one of the preeminent cannabis companies in the industry," said Nick Colvin, CEO of CannaPharmaRx. "Furthermore, to have favorable, non-dilutive financing available allows for material growth without affecting our capital structure. With our strong capability to oversee business development coupled with the high-tech, low-cost production facilities being purchased, we feel this is a potential watershed moment for our company. We are confident that this acquisition, as well as our other recent purchase in Cremona, will become accretive shortly after the closing because most of the infrastructure is already in place in both facilities," added Colvin.
For more information:
CannaPharmaRX
Suite 3600, 808 3rd Street SW
Calgary, AB, T2P 5C5
cannapharmarx.com