The Flowr Corporation Completes the Acquisition of Holigen
August 21st, 2019
TORONTO, Aug. 20, 2019 (GLOBE NEWSWIRE) — The Flowr Corporation (TSXV: FLWR; OTC: FLWPF) (“Flowr” or the “Company”) is pleased to announce the completion of the acquisition of the remaining 80.2% interest in Holigen Holdings Limited (“Holigen”) by way of a share purchase agreement, as previously announced on June 24, 2019 (the “Acquisition”).
“We are excited to complete the acquisition of Holigen and thereby add operations in Portugal and Australia to our existing Canadian platform. The combination of our extensive cannabis cultivation know-how and Holigen’s extensive pharmaceutical experience has the potential to create tremendous value. With an expected annual capacity of 500,000 kilograms, the Aljustrel cultivation asset in Portugal should allow us to be a significant producer in the global medical cannabis and active pharmaceutical ingredient (API) markets, initially in Europe and Australia-Asia,” said Vinay Tolia, Flowr’s Chief Executive Officer. “We continue to see the cannabis market bifurcating into premium, superior quality adult use products, where legal, and a global medical opportunity that will require massive production scale and deep GMP expertise. With the completion of this acquisition, the subsequent ramp-up of production at Aljustrel, and the continued buildout of our campus in Kelowna, Flowr is strategically positioned to service the global cannabis market from an efficient footprint.”
Total consideration for the Acquisition included:
- Cash consideration of CAD $6,299,423.76;
- Issuance of 32,632,545 Series 1 Voting Convertible Redeemable Preferred shares (“Consideration Shares”) of the Company. The Consideration Shares shall convert into common shares of the Company (“Common Shares”), on a 1:1 basis, subject to the following milestones:
- 10% of the Consideration Shares were automatically converted into Common Shares immediately after issuance on Closing;
- 40% of the Consideration Shares will automatically convert into Common Shares six (6) months from the Closing; and
- The remaining 50% of the Consideration Shares will convert into Common Shares when and if Holigen achieves certain milestones related to the lodging of product applications and achieving certain planting targets in Australia and Portugal;
- The purchase of certain loans up to a maximum amount of CAD $365,188.73; and
- Flowr has also agreed to pay the aggregate amount of €1,378,106.53 to certain of Holigen’s creditors.
Except as provided by law, the holders of Consideration Shares are entitled to vote with the holders of outstanding Common Shares and in any such vote, each Consideration Share shall be entitled to a number of votes equal to the number of Common Shares into which such Consideration Share is convertible.
About The Flowr Corporation
Flowr, through its subsidiaries, holds cannabis production and sales licenses granted by Health Canada. With a head office in Toronto and a production facility in Kelowna, BC, Flowr builds and operates large-scale, GMP-designed cultivation facilities utilizing its own growing systems. Flowr’s investment in research and development along with its sense of craftsmanship and a spirit of innovation is expected to enable it to provide premium-quality cannabis that appeals to the adult-use recreational market and addresses specific patient needs in the medicinal market.
For more information, visit flowr.ca. Follow Flowr on Twitter: @FlowrCanada; Facebook: Flowr Canada; Instagram: @flowrcanada; and LinkedIn: The Flowr Corporation.
On behalf of The Flowr Corporation:
CEO and Director
Vice President, Communications & Public Relations
(877) 356-9726 ext. 1526
Head of Capital Markets
(877) 356-9726 ext. 1528
This press release includes forward-looking information within the meaning of Canadian securities laws regarding Flowr, Holigen and their respective businesses, which may include, but are not limited to: Flowr building its global medical platform; the combination of Flowr’s extensive cultivation know-how and Holigen’s extensive pharmaceutical experience potentially creating tremendous value; the capacity of the Aljustrel site, the scale of the Aljustrel cultivation asset allowing Flowr to be a significant producer in the global medical cannabis and API market; the cannabis market bifurcating into premium, superior quality adult use market and global medical opportunity that will require massive production scale and deep GMP expertise; ramping-up production at Aljustrel and continuing to buildout the campus in Kelowna; Flowr being strategically positioned to service the global cannabis market; the conversion of Consideration Shares into Common Shares and other statements about the Acquisition and matters ancillary thereto; the business, production and products of Flowr; and Flowr’s investment in research and development along with its sense of craftsmanship and a spirit of innovation enabling it to provide premium-quality cannabis that appeals to the adult-use recreational market and address specific patient needs in the medicinal market.
Often, but not always, forward-looking information can be identified by the use of words such as “potential”, “plans”, “is expected”, “expects”, “scheduled”, “intends”, “contemplates”, “anticipates”, “believes”, “proposes” or variations (including negative and grammatical variations) of such words and phrases, or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Such statements are based on the current expectations of Flowr’s management and are based on assumptions and subject to risks and uncertainties. Although Flowr’s management believes that the assumptions underlying these statements are reasonable, they may prove to be incorrect. The forward-looking events and circumstances discussed in this press release may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting Flowr, including risks relating to Flowr being unable to build a global medical platform; the combination of Flowr’s cultivation know-how and Holigen’s pharmaceutical experience not creating value; the Aljustrel cultivation asset not allowing Flowr to be a significant producer in the global medical cannabis and API market; the cannabis market not bifurcating in the manner Flowr anticipates and/or not requiring the anticipated production scale and GMP expertise; Flowr being unable to ramp-up production at Aljustrel and/or continue the buildout of its campus in Kelowna; the Aljustrel site not producing the expected capacity described herein, which could materially impact Flowr’s financial results and the value of Holigen; Flowr being unable to service the global cannabis market; risks relating to the use of Flowr’s or Holigen’s products; risks relating to the markets in which Flowr and Holigen operate and/or distribute their respective products; possible failure to realize the anticipated benefits of the transaction described herein; risks associated with operating in the markets in which Flowr and Holigen operate; the failure to receive licenses and/or construct Flowr’s and/or Holigen’s facilities and sites, Holigen’s license and/or product applications being delayed or not completed; general economic and stock market conditions; risks and uncertainties detailed from time to time in Flowr’s filings with the Canadian Securities Administrators; the inability of Flowr’s products to appeal to the adult-use recreational market and address specific patient needs in the medicinal market; and many other factors beyond the control of Flowr.
Although Flowr has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking information can be guaranteed. Except as required by applicable securities laws, forward-looking information speaks only as of the date on which it is made and Flowr undertakes no obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events, or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
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