VANCOUVER, Dec. 19, 2018 /CNW/ - AgraFlora Organics International Inc., a growth-oriented and diversified international cannabis company, is pleased to announce the acquisition of 100-percent interest in the London, Ontario-based licensed cannabis producer AAA Heidelberg Inc.
In conjunction with the acquisition the Company has issued 12,216,509 common shares at a deemed price of $0.1667 per share to the shareholders of AAA Heidelberg Inc. pursuant to the share exchange agreement entered into between the Company, AAA Heidelberg and the shareholders of AAA Heidelberg dated Jan. 26, 2015. The completed share transfer has resulted in the acquisition of the remaining interest of the AAA Heidelberg licensed facility and the entity is now a wholly owned subsidiary of AgraFlora Organics International Inc.
"This acquisition marks a very important milestone in AgraFlora's growth initiative and designation as an official licensed cannabis production company." said Derek Ivany, President and CEO of AgraFlora Organics International Inc. "This, combined with the Company's 2,200,000 square foot Delta Greenhouse facility places AgraFlora among the largest potential per square footage cannabis producers in Canada and we are focused on bringing both facilities into revenue generating production in 2019."
AgraFlora's AAA Heidelberg personnel are currently working with Canopy Growth to initiate the first crop of high quality medical cannabis at the London, Ontario-based facility.
In Delta, BC the Company continues the retrofit of the existing 2,200,000 square foot Delta Greenhouse Complex and operations are currently on schedule to complete 250,000 sq. ft. of flowering area by the end of the Q2 2019. AgraFlora intends on completing the total of 1,700,000 sq. ft. of flowering area by the end of 2019 and the final phase of the greenhouse retrofit is planned to include an additional 450,000 sq. ft. of flowering area scheduled for completion in the summer of 2020.
The shares issued pursuant to the Agreement and the debt settlements are subject to a four month hold period.
The acquisition of the remaining interest in licensed cannabis producer AAA Heidelberg follows AgraFlora's Dec. 13, 2018 announcement of a supply agreement with Namaste Technologies Inc.'s wholly-owned subsidiary, Cannmart Inc. for the right of first refusal to purchase up to 10% of the total annual production from AgraFlora's large-scale Delta Greenhouse Complex. This represents up to 25,000,000 grams per year, at a price of $4 per gram.
As announced on Dec. 10, 2018 the Company recently closed on a $7.5-million second tranche of a $40-million financing to be used exclusively to develop the Delta Greenhouse Complex. A total of $20 million have been raised with the remaining $20 million to be paid in two tranches of $5 million on Jan. 15 and $15 million on March 1, 2018.
