SYDNEY, AUSTRALIA: Zelira Therapeutics Ltd (ASX:ZLD) has executed a binding scheme implementation deed to acquire 100% of Health House International Limited (ASX: HHI) via a scheme of arrangement.
Zelira believes that the addition of the Health House business will create an organisation with strong medicinal cannabis product and distribution capabilities.
The acquisition will see Health House parties hold 19.45% of the expanded Zelira. In addition, Zelira has already provided Health House with a $1.5 million working capital facility to assist it with its working capital needs.
Following Zelira shareholders approving the consolidation of the Company’s capital at a meeting on 12 April 2022, all consideration shares issued will be on a post-consolidation basis.
This transaction would result in Zelira paying Health House shareholders a Scheme Consideration of 2,311,045 of the enhanced Zelira shareholding, representing 19.45% of the company and would result in a total value to Health House shareholders that is a 20% premium to the market capitalization of Health House as of April 18, 2022.
Health House is an international distributor of medicinal cannabis and holds a number of strategic licenses to store, distribute, import, export and wholesale controlled drugs. Health House is well positioned with early mover advantage in the UK and European medicinal cannabis markets.
Health House also has supply agreements in place with several pharmaceutical grade Good Manufacturing Practice (GMP) certified manufacturers and producers of high-quality medicinal cannabis products.
It holds, the EU GMP licence issued by the German authorities under the framework of the European Commission (one of the word’s leading regulatory authorities for the production and manufacturing of pharmaceutical grade medicinal products).
Additionally, Health House owns a medicinal cannabis consultancy in the EU, with online services available in six languages. Which, in addition to patient consultancy activities, provides educational training to health care professionals, and is currently undertaking a non-interventional observational study in Germany considering the effect on quality of life of patients and the safety and tolerability of cannabis medication.
Zelira Therapeutics Global Managing Director & CEO Oludare Odumosu said: “The proposed acquisition of Health House will maximise Zelira’s unique capability to develop new clinically validated products that can be marketed and distributed on a global basis. Post-merger it is anticipated, Zelira’s revenue profile will be accelerated, margins will increase from the sale of Zelira’s products in markets that Health House is currently active, and cashflow breakeven will be brought forward.”
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