VANCOUVER, BRITISH COLUMBIA – April 6, 2020 -- Rubicon Organics Inc. has announced that it has completed the sale of its 40,000 sq. ft. hybrid greenhouse in Ferndale, Wash., for US$8.5 million to a group of real estate investors. Proceeds from the sale will strengthen the company’s balance sheet, providing working capital to ramp-up production and sales across Canada.
“The sale of the Washington greenhouse is an important step in focusing the company on our core strength of bringing super-premium certified organic cannabis to the Canadian market,” said Bryan Disher, Chairman of the Board. “This transaction creates tremendous value for our shareholders by achieving a clean and timely exit from the U.S., while accelerating our timeline to profitability through focusing exclusively on our high-return Canadian operations.”
Rubicon Organics will continue to sell its remaining U.S. assets, which consists of a 3-acre land parcel in Greenfield, Calif., and certain cannabis extraction equipment. The company expects to complete the dispositions of all cannabis-related U.S. assets in the coming months.
The buyers are led by the cannabis license holder who has leased the facility from Rubicon Organics since November 2018 and includes Jesse McConnell, Rubicon Organics’ CEO, who also holds a minority interest in the buyer entity. In accordance with good corporate governance practices, Rubicon Organics formed a Special Committee, comprised entirely of independent directors, who supervised the negotiation of the transaction and recommended the transaction for approval to the full Board.
As part of the transaction, Rubicon Organics settled the US$3.0 million secured debt on the facility.