Napanee, Ontario-based VIVO Cannabis (TSX: VIVO) (OTC: VVCIF), formerly called AbCann, invested CAD $5 million in Westleaf Cannabis Inc. to be used to advance the rollout of WestLeaf’s retail operations across Canada and as a supply agreement.
In the agreement, VIVO will supply cannabis to Westleaf’s multiple retail locations. Westleaf gets access to VIVO’s portfolio of adult-use brands, including FIRESIDE, Lumina and Canna Farms, as well as the option to create in-house brands using VIVO’s products.
“With our strong cash position of approximately $100 million, VIVO will continue to pursue opportunities across the full value chain,” stated Barry Fishman, CEO of VIVO.
Westleaf is going national with its “Prairie Records” retail brand concept, which ties cannabis and music. It is constructing production facilities in Alberta and Saskatchewan. Scott Hurd, President and CEO of Westleaf, said, “Our vertically integrated strategy, innovative retail concepts and…retail locations differentiate us from competitors… This investment by VIVO…is a strong endorsement of our strategy and team….”
VIVO invested CAD $5 million in exchange for 5.8 million units of Westleaf at a price of $0.85 per unit. Each unit consists of one Westleaf common share and one-half of one common share purchase warrant. Each warrant entitles VIVO to buy one share of WestLeaf for $1.30 for 24 months. Westleaf will have the right, on ten-days notice, to accelerate the expiry of the Warrants at any time if the ten-day average price of the Shares is greater than $1.80.
VIVO stock was at CAD $1.42 on October 4, 2018.
Napanee, Ontario-based VIVO, formerly called AbCann Global (name change in August 2018), holds production and sales licenses. Its brands include Beacon Medical, FIRESIDE, Canna Farms and Lumina.
VIVO is expanding its production capacity and pursuing partnership and product development opportunities domestically, and in Germany and Australia. In August 2018 it acquired Canna Farms Limited, a premium cannabis company based in Hope, British Columbia. Canna Farms has a significant patient base and positive cash flow.
VIVO also operates Harvest Medicine, a network of specialty medical cannabis clinics. Harvest Medicine has over 15,000 patients in its clinics and via its free telemedicine platform.
Source: VIVO press release