Cannabis Wheaton to buy 80% of In­verell for $15M (U.S.)

Cannabis Wheaton In­come Corp. has signed a bind­ing agree­ment to ac­quire an 80-per-cent in­ter­est in In­verell SA. It will pay $15-mil­lion (U.S.) to In­verell’s share­hold­ers as con­sid­er­a­tion.

Stockwatch Daily - - FRONT PAGE - Mr. Chuck Ri­fici re­ports

CANNABIS WHEATON In­come Corp. (do­ing busi­ness as Wheaton In­come) has en­tered into a bind­ing in­terim agree­ment with In­verell SA, pur­suant to which Wheaton will pur­chase 80 per cent of the is­sued and out­stand­ing com­mon shares on a fully di­luted ba­sis of In­verell.

In­verell is a fed­er­ally li­censed cannabis op­er­a­tor based in Montevideo, Uruguay, and was founded by Dr. Raul Urbina. Dr. Urbina com­pleted his post­grad­u­ate stud­ies in molec­u­lar bi­ol­ogy at Prince­ton Univer­sity and agron­ics at the Univer­sity of Alme­ria in Spain, and pos­sesses broad ex­pe­ri­ence man­ag­ing high-tech agri­cul­tural projects with a strong in­no­va­tion com­po­nent. His ex­pe­ri­ence also in­cludes found­ing Ste­via One, where un­der his lead­er­ship as chief ex­ec­u­tive of­fi­cer, the com­pany be­came the low­est-cost pro­ducer of ste­via in the world, ex­panded its field un­der pro­duc­tion up to 1,000 hectares in five years and achieved the high­est pu­rity with the high­est yields in the mar­ket. Pur­suant to the agree­ment, Dr. Urbina will re­main as CEO of In­verell and leader of the in­no­va­tion depart­ment of the com­pany.

In­verell’s cannabis op­er­a­tor li­cence al­lows it to cul­ti­vate and harvest its pro­pri­etary hemp strain (RU), which con­tains ap­prox­i­mately 0.5 per cent THC (tetrahy­dro­cannabi­nol) and up to 8 per cent CBD (cannabid­iol). In­verell also pos­sesses a prime ge­netic bank and three ad­di­tional hemp strains with vari­a­tions of higher CBD and lower THC con­cen­tra­tions. In­verell cur­rently has 16 hectares (ap­prox­i­mately 1.72 mil­lion square feet) planted, which are es­ti­mated to be har­vested in April, 2018. In­verell has an­other 574 hectares avail­able for cul­ti­va­tion for a to­tal of 600 hectares (ap­prox­i­mately 60 mil­lion square feet).

The li­cence also per­mits In­verell to plant up to five hectares of its pro­pri­etary ge­net­ics for the pur­poses of pro­duc­ing fem­i­nized seeds. In ad­di­tion, In­verell has ap­plied for a li­cence to con­duct re­search and de­vel­op­ment on var­i­ous forms of cannabis and ex­pects to re­ceive the nec­es­sary gov­ern­men­tal and reg­u­la­tory ap­provals in short or­der.

Pur­suant to the agree­ment, the share­hold­ers of In­verell are en­ti­tled to re­ceive ag­gre­gate con­sid­er­a­tion of $15-mil­lion (U.S.) to be paid as fol­lows:

1. $2-mil­lion (U.S.) in cash on clos­ing of the trans­ac­tion;

2. $3,562,500 (U.S.) payable in com­mon shares in the cap­i­tal of Wheaton on clos­ing;

3. $9,437,500 (U.S.) payable i n com mon shares upon the achieve­ment of cer­tain mile­stones, in­clud­ing the suc­cess­ful reg­is­tra­tion of In­verell’s cannabis ge­net­ics and the suc­cess­ful ex­por­ta­tion of CBD prod­ucts.

Hugo Alves, pres­i­dent of Wheaton, stated: “We are in­cred­i­bly ex­cited to work with Dr. Urbina and his team in Uruguay. This trans­ac­tion helps us se­cure a sig­nif­i­cant amount of CBD-rich hemp pro­duc­tion that can be ex­ported to other fed­er­ally le­gal ju­ris­dic­tions for fur­ther pro­cess­ing into nu­tri­tional and phar­ma­ceu­ti­cal prod­ucts. We ex­pect to see a sig­nif­i­cant in­crease in global CBD de­mand over the course of the com­ing years and be­lieve that low-cost ju­ris­dic­tions with favourable cli­mates for out­door cul­ti­va­tion will be key sources of CBD sup­ply. As we con­tinue to ex­e­cute our in­ter­na­tional strat­egy, we are thrilled to have iden­ti­fied In­verell as our first in­ter­na­tional pro­duc­tion op­er­a­tion.”

Chuck Ri­fici, chief ex­ec­u­tive of­fi­cer of Wheaton, stated: “This trans­ac­tion serves as our first en­try into Latin Amer­ica and pro­vides our plat­form with a di­ver­si­fied source of low-cost CBD pro­duc­tion for our in­ter­na­tional dis­tri­bu­tion chan­nels. We be­lieve that Dr. Urbina and In­verell’s ex­pe­ri­ence in large-scale com­mer­cial cul­ti­va­tion will be a sig­nif­i­cant com­pet­i­tive ad­van­tage for our do­mes­tic op­er­a­tions, es­pe­cially when out­door cul­ti­va­tion is per­mit­ted in Canada.”

Dr. Urbina stated, “We are very ex­cited to start this new ad­ven­ture with a com­pany that shares our val­ues and vi­sion and that will al­low us to help de­liver cannabis prod­ucts un­der our three-P phi­los­o­phy: peo­ple, planet, profit.”

The trans­ac­tion re­mains sub­ject to cer­tain con­di­tions prece­dent, in­clud­ing re­ceipt of ap­pli­ca­ble reg­u­la­tory ap­provals and the ex­e­cu­tion of a de­fin­i­tive agree­ment.

About Cannabis Wheaton In­come Corp.

Wheaton In­come is a col­lec­tive of en­trepreneurs with a pas­sion for the cannabis in­dus­try past, present and fu­ture. The com­pany’s man­date is to fa­cil­i­tate growth for the com­pany’s part­ners by pro­vid­ing them with fi­nan­cial sup­port and shar­ing the com­pany’s col­lec­tive in­dus­try ex­pe­ri­ence. The com­pany’s part­ners all have dif­fer­ent vi­sions, voices and brand val­ues, and all share a com­mon goal: to build a world-class in­dus­try based on ethics, di­ver­sity, qual­ity and in­no­va­tion.

We seek Safe Har­bor.

Hugo M Alves, Bran­don Wade Boddy, Troy James Grant, Ian McKay, Charles Ri­fici

(CBW) Shares: 351,175,740

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