TORONTO and DENVER, Jan. 02, 2020 (GLOBE NEWSWIRE) -- PRESS RELEASE -- MJardin Group, Inc., a premium cannabis producer, has announced that it has entered into a definitive agreement with Harvest DCP of Nevada, Cheyenne Holdings LLC, a division of Harvest Health and Recreation Inc., to sell all of its interest in GreenMart of Nevada LLC, which possesses a Nevada Marijuana Cultivation Facility License and operates the cultivation facility at 5421 E. Cheyenne, Nevada, for a total consideration of US$35 million in cash, comprised of US$30 million on Dec. 31, 2019, plus US$5 million upon license transfer, subject to regulatory approvals.
The company will use the proceeds of the transaction to reduce its debt obligations and for working capital requirements for its 2020 plan.
“We are pleased with the return on our investment at Cheyenne. The proceeds from the transaction significantly reduce our debt while strengthening our financial position towards funding our working capital requirements in 2020,” said Pat Witcher, president and CEO of MJardin. “We are starting the new year on stronger footing with a clear view on accomplishing our profitability targets based on all of our key assets coming online.”
MJardin continues to focus on growing operations in Nevada through Cannabella, an extraction, distribution and consumer product company acquired in the spring of 2019 (license transfer pending). Cannabella’s products are already in approximately 50 of the 68 retail dispensaries in Nevada, and the company anticipates that it will be able to expand to many of the new dispensaries being opened following the recent grant of approximately 50 additional licenses.
The transaction has been unanimously approved by the Board of Directors of the company, following the unanimous recommendation of a special committee of independent directors of the company. Canaccord Genuity Corp. acted as exclusive financial advisor to MJardin. Canaccord Genuity and Cormark Securities have provided fairness opinions to the special committee of the Board of Directors of the company stating that, as of the date of such opinions, and based upon and subject to the assumptions, limitations and qualifications stated in such opinions, the consideration being received under the transaction is fair, from a financial point of view, to the Company. Foley & Lardner LLP acted as U.S. counsel and Norton Rose Fulbright Canada LLP acted as Canadian counsel to MJardin on the transaction.
