TORONTO–(BUSINESS WIRE)–Halo Labs Inc. has entered into a binding Letter of Intent (LOI) to acquire all of the common shares of Canmart Limited in the United Kingdom (UK). The total transaction size of the Canmart acquisition is anticipated to be C$6 million, payable in Halo common shares and at a deemed price of C$0.35 per share.
Consideration will be paid as Canmart achieves critical business milestones. Halo’s acquisition of Canmart is expected to sign and close within the next seventy-five days.
This is Halo’s first planned international acquisition of an importer and distributor of licensed medicinal cannabis products.
The Company aims to acquire, partner and apply for further national licenses within Europe and other territories to give Halo direct market access for its products made from medical cannabis grown at the Company’s 205-hectare Bophelo cannabis cultivation zone in Mafeteng, Lesotho. Via Canmart Limited, which is approved for import into the UK, Halo anticipates commencing exports to the UK towards the second half of 2020, subject to regulatory approvals.
Commenting on the transaction, CEO and Co-Founder of Halo Kiran Sidhu said, “The UK is one of the world’s largest individual cannabis markets. Our goal is to become a major player in the UK in the coming years. With the quality and cost of medical cannabis we are growing in Lesotho, the acquisition of Canmart will put us in prime position to grow our business as cannabis-based medicinal treatments become more mainstream across Great Britain.”
Darran Quinn, Founding Director of Canmart added, “The UK Medicinal Cannabis market is poised for major growth. Working with Halo provides Canmart a sustainable competitive advantage in the both short and long term. Halo’s management team combined with the Company’s focused seed to sale international strategy will provide great value for us now that we will be Halo shareholders.”
The UK is one of the largest national cannabis markets in the world and permits the import of CBPMs from non-European Union countries. Although the UK is one of the world’s leading exporters of cannabis plants for medicine and scientific research, it imports 100% of its CBPMs for domestic use. As such, the UK presents Halo with a significant opportunity to commence its export strategy from Bophelo. Completion of the Canmart Acquisition will be the first step in achieving this goal.