Khiron Advances Multi-Country Operator Strategy by Signing Definitive Agreement to Acquire Licence in Uruguay
- Upon completion of the Acquisition of NettaGrowth International Inc., Khiron´s total production capacity is expected to increase to up to 220 tonnes
- Diversifies Khiron´s licence composition to include adult use and flower cultivation distribution capabilities
- Secures a scientific and investigation agreement with Institute Pasteur of Montevideo, a respected biotechnology researcher and developer in Uruguay
- Concurrent with closing, Mr. Michael Beck, experienced capital markets professional and entrepreneur, to join the board of Khiron, and Mr. Joseph Mimran, experienced brand builder and entrepreneur, to join board of Khiron Colombia
TORONTO, April 9, 2019 /CNW/ - Khiron Life Sciences Corp. ("Khiron" or the "Company") (TSXV: KHRN), (OTCQB: KHRNF), (Frankfurt: A2JMZC), an integrated medical cannabis company with its core operations in Latin America, announced today that it has signed a definitive agreement for the acquisition of NettaGrowth International Inc. ("NettaGrowth"), as previously announced on January 25, 2019. NettaGrowth will, at the time of the closing of the acquisition, own all of the outstanding shares of Dormul S.A. ("Dormul"), a Uruguayan company that has obtained the first licence to produce and export medical cannabis with THC for commercialization in Uruguay. As consideration for the acquisition of NettaGrowth, on closing, Khiron will issue 8,498,821 common shares to the shareholders of NettaGrowth at a deemed price of $1.61 per common share.
Alvaro Torres, CEO of Khiron, comments
This acquisition adds considerable capacity and product diversity potential to the Khiron portfolio of assets. As the first country to legalize cannabis for adult use purposes, these Uruguayan licences provide us the opportunity to address a broader demographic of consumers and export products to key regions of the world. Compared to the extract-only medical market of Colombia, the Uruguayan regulations permit the domestic and international distribution of flower. This is an excellent complement to our product focus in Colombia. I would like to thank all individuals involved in finalizing this definitive agreement and look forward to moving this transaction to close.
Uruguay was the first country to establish legislation for cannabis and Dormul has secured a medical cannabis cultivation and commercialization licence for the jurisdiction, with a cultivation capacity of up to 120 tonnes and 170,000 plants. In addition, Dormul has an application pending for an extraction licence. Upon receipt of its extraction licence, Dormul is expected to become the first company in Uruguay to be approved for medical cannabis-based CBD oils for both domestic and export purposes. With a strong commitment to research and development, Dormul has established a strategic partnership with the prestigious Institut Pasteur de Montevideo, a prestigious foundation formed between the Uruguayan and French governments focused on the research and development of cannabis product. The foundation was recently recognized by the Uruguayan Ministry of Industry for the important social and economic impact its operations are anticipated to have for the country.
In addition, Mr. Michael Beck, experienced capital markets professional and entrepreneur, and Mr. Joseph Mimran, experienced brand builder and entrepreneur, have agreed to join the board of Khiron and Khiron Colombia, respectively. The appointments are conditional upon the completion of the acquisition and subject to TSXV Venture Exchange Inc. ("TSXV") approval.
Upon the closing of the acquisition, a finder's fee of 420,000 common shares will be paid to Oisin Fanning. Completion of the acquisition, and the issuance of the finder fee shares, remains subject to customary closing conditions including, but not limited to, anti-money laundering approval from the Uruguayan government and final approval of the TSXV.
About NettaGrowth and Dormul
NettaGrowth, through Dormul, is a Latin America export focused cannabis company based in Uruguay, and is well positioned to serve Brazil and the growing Latin American market. They will employ the latest growing, extracting and processing technologies to produce high quality medical cannabis products for the Latin American market.
Khiron Life Sciences Corp. is positioned to be the dominant integrated cannabis company in Latin America. Khiron has core operations in Latin America and is fully licensed in the country for the cultivation, production, domestic distribution, and international export of both THC (tetrahydrocannabinol) and CBD (cannabidiol) medical cannabis. In May 2018, Khiron listed on the TSX Venture Exchange, becoming the first Colombian based medical cannabis company to trade on any exchange globally.
With a focused regional strategy and patient oriented approach, the Company combines global scientific expertise, agricultural advantages, branded product market entrance experience and education to drive prescription and brand loyalty to address priority medical conditions such as chronic pain, epilepsy, depression and anxiety in the Latin American market of over 620 million people. Khiron is led by Co-founder and Chief Executive Officer, Alvaro Torres, together with an experienced executive team, and a knowledgeable Board of Directors that includes former President of Mexico, Vicente Fox.
Further information on Khiron Life Sciences can be found at www.khiron.ca.
This press release may contain certain "forward-looking information" and "forward-looking statements" within the meaning of applicable securities legislation. All information contained herein that is not historical in nature may constitute forward-looking information. Forward-looking statements may be identified by statements containing the words "believes", "anticipates", "plans", "intends", "will", "should", "expects", "continue", "estimate", "forecasts" and other similar expressions. Forward-looking statements herein include, but are not limited to, statements regarding the anticipated benefits of the acquisition, Dormul's cultivation capacity, receipt by Dormul of an extraction licence, the appointment of additional directors to Khiron and its subsidiary's boards, and receipt of all required regulatory approvals, among others. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements. Khiron undertakes no obligation to comment analyses, expectations or statements made by third-parties in respect of Khiron, its securities, or financial or operating results (as applicable). Although Khiron believes that the expectations reflected in forward-looking statements in this press release are reasonable, such forward-looking statement has been based on expectations, factors and assumptions concerning future events which may prove to be inaccurate and are subject to numerous risks and uncertainties, certain of which are beyond Khiron's control, including the risk factors discussed in Khiron's Annual Information Form which is available on Khiron's SEDAR profile at www.sedar.com. The forward-looking information contained in this press release is expressly qualified by this cautionary statement and are made as of the date hereof. Khiron disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.
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