SYDNEY, AUSTRALIA: Little Green Pharma Ltd (LGP) announced the acquisition of a world class cannabis GACP cultivation and EU-recognised GMP licensed cannabis production facility located in Denmark as well as the receipt of firm commitments to raise A$27.2 million by way of placement to institutional and sophisticated investors.
Little Green Pharma Ltd (LGP) plans to ramp up production at the Denmark Facility in line with market demand and anticipates producing LGP-branded and white-label medicines as well as bulk cannabis flower products for supply into global markets.
The acquisition positions LGP as a leading global pure play medicinal cannabis producer and owner of one of the largest cannabis production assets in Europe.
LGP acquired the Denmark Facility from Canopy Growth Corporation for a total consideration of C$20 million. The acquisition was executed via a sale and purchase agreement (SPA) to acquire 100% of the securities in Canopy Growth Denmark, which owns and operates the Denmark Facility.
Under the terms of the Acquisition, the Company acquired LGP Denmark for a total of C$20 million in cash, with C$10 million paid at Completion and the remaining C$10 million payable in 12 months pursuant to a retained loan at an imputed interest rate of 12.5%.
LGP plans to ramp up production at the Denmark Facility in line with market demand and anticipates producing LGP-branded and white-label medicines as well as bulk cannabis flower products for supply into global markets.
The Acquisition positions LGP as a leading global pure play medicinal cannabis producer and owner of one of the largest cannabis production assets in Europe.
LGP’s Managing Director Fleta Solomon said, “The Acquisition is a step change for LGP. We have been speaking for some time about the need to increase our production capacity and the Denmark Facility not only gives us the cultivation and manufacturing capacity we need but does so immediately. We won’t be constrained by the two-year build and permitting time required to expand our existing West Australian Facility.
“We are well positioned in the market to capitaliseon the brand equity LGP has built in Europe and Australia, with the Denmark Facility providing immediate access to medical grade product at volumes that will allow us the opportunity to accelerate our growth strategy.
“We are confident this Acquisition is an efficient use of our capital and will drive long term value for our shareholders. The Denmark Facility provides more than eight times the capacity of our previous planned production expansion.
“Purchasing the Denmark Facility provides both cost and time savings and was a preferable option to building out production capacity at our existing facility. We’ll keep our foot on our Australian property for longer term growth but are now able to redeploy the significant capex investment we had planned.
“We greatly appreciate the support of our institutional shareholders in helping us accelerate our growth strategy.”
Little Green Pharma Ltd ASX: LGP
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22 Jun, 3:16 pm GMT+10 ·Disclaimer