Simply Solventless To Acquire CannMart As It Seeks To Expand Into Hydrocarbon Cannabis Concentrates
Simply Solventless Concentrates Ltd. HASH is acquiring Lifeist Wellness Inc.'s LFST (FRANKFURT: M5B) LFSWF subsidiary CannMart Inc.
The Calgary, Alberta-based company said on Wednesday that it has entered into a services agreement regarding the operations of CannMart and a share purchase agreement with Lifeist Wellness Inc. to acquire all of the shares of CannMart.
Key terms of the services agreement are as follows:
The purchase price under the agreement includes $500,000 cash, $500,000in units on the same terms as the financing, and a vendor takeback note of $1,500,000 on the closing of the acquisition.
SSC noted in a press release the agreements related to both transactions are dated June 25, 2024. CannMart Labs Inc., another of Lifeist’s subsidiaries, which is currently in the companies’ creditors arrangement act (Canada) proceedings, is not involved in the transactions.
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SSC simultaneously announced a non-brokered private placement of up to 14 million units at $0.25 per unit for aggregate gross proceeds of up to $3.5 million, with each unit consisting of one common share and one-half of one common share purchase warrant of SSC. Each whole warrant is exercisable for one common share of SSC at $0.40 per share for two years from the date of issue. The financing, which is subject to the approval of the TSXV is expected to close on or around July 5, 2024.
Jeff Lawrence, SSC’s vice president of sales and marketing, has been promoted to the position of chief commercial officer.
Colin Davison, a member of SSC’s board of directors, and Randeep Gill, SSC’s vice president of commercials, have resigned due to personal reasons.
CannMart owns the brands Roilty and Zest Cannabis both featuring hydrocarbon extract products in Alberta, Ontario, Saskatchewan and Manitoba as well as a presence in Quebec, the Maritimes, and the Territories.
“Through CannMart, Lifeist has done a fantastic job of building two great brands, Roilty and Zest Cannabis, and achieving national reach and substantial revenue capability," Jeff Swainson, SSC’s president & CEO, said. "Continuing SSC’s strategic objective of opportunistic acquisitions, these Transactions establish SSC as one of the leaders in hydrocarbon concentrates, taking the baton from Lifeist, and building strongly upon SSC’s leadership position in solventless concentrates."
CannMart also has a Health Canada-licensed facility in Ontario near the Ontario Cannabis Store warehouse.
"Moving forward, the focus of our talented team will be the integration of CannMart, continued profitable organic branded revenue growth and opportunistic acquisitions such that we provide continued value to our shareholders," Swainson said.
Closing of the acquisition is subject to a number of conditions precedent, including but not limited to the approval of the TSXV, notification which is satisfactory to Health Canada and approval of the shareholders of Lifeist.