Emblem Corp. (TSXV:EMC) (OTCBB:EMMBF) announced this morning that the company has signed an LOI to acquire all of the issued and outstanding securities in Natura Naturals Inc., a licensed greenhouse cultivator of medicinal cannabis in Canada.
If the transaction is approved, Natura Naturals assets will be exchanged for $25 million in cash, $12.5 million in mortgage financing and 26,102,941 common shares of Emblem. The total value of the transaction will be $76M.
Natura Naturals has 40 years of greenhouse cultivation experience and currently owns and operates a 662,000 square feet facility growing medicinal cannabis. The facility is currently capable of an annual output of 15,000 kg and once construction on it is complete in 2019 it will be capable of an annual output of 70,000 kg. Along with the facility, Emblem will also acquire 32 proprietary cannabis strains from the company.
Emblem is looking to expand its current operations to fulfill the expected demand for recreational cannabis in Canada, set to become legal in October 2018. The company is expected to receive management experience, proprietary technology, and a fully functioning greenhouse facility which will significantly increase its production capacity. The signed LOI is expected to go through after due diligence is completed by both parties.
Nick Dean, CEO of Emblem Corp said, “Through the due diligence process of investigating Natura as a supply partner, we uncovered significant synergies between the two organizations. Providing high quality products to Emblem’s medical and adult-use audiences continues to be our top priority.”
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