MMJ Group Invests CAD$6m in WeedMD Inc.
"This is another example of MMJ's strong market and financial discipline identifying opportunities and bottlenecks in the cannabis value-chain in markets and acting quickly," MMJ's Chairman, Mr Peter Wall, said.
Mr. Wall stated, "WeedMD was an opportunity for MMJ to invest in a highly attractive manner and which allows WeedMD to capitalise on being sufficiently funded for current cultivation operations and to build out its extraction facility. WeedMD has executed its business plan quite well and has now expanded into outdoor cultivation and has well capitalized plans to become a provider of extracted cannabis products."
MMJ worked with its specialist management company, Embark Ventures, to evaluate the investment opportunity and WeedMD is the third investment made for MMJ.
WeedMD Inc. (the Company) is the publicly-traded parent company of WeedMD Rx Inc., a federally-licensed producer of cannabis products for both the medical and adult-use markets. The Company owns and operates a 158-acre state-of-the-art greenhouse and outdoor facility located in Strathroy, ON. The Company also operates CX Industries, a wholly-owned subsidiary of WeedMD Inc. CX Industries operates out of the Company's fully-licensed 26,000 sq. ft. Aylmer, Ontario production facility which specializes in cannabis extraction and processing. WeedMD has a multi-channeled distribution strategy that includes selling directly to medical patients, strategic relationships across the seniors' market and supply agreements with Shoppers Drug Mart as well as six provincial distribution agencies where WeedMD's adult-use brand Color Cannabis is sold. WeedMD had a market capitalisation of CAD$153m.
MMJ's investment consists of CAD$6m in 8.5% unsecured convertible debenture units issued by WeedMD which may be converted into 3.75m shares within three years.
MMJ has also secured the right to make further investments in WeedMD through warrants that allow MMJ to acquire an additional 3.75m shares for CAD$1.80 each for a period of 3 years.
Settlement of the WeedMD investment is expected on or about 26 September 2019 and will be funded from MMJ's existing cash reserves of AUD20m.
A copy of the WeedMD's press release in respect of the closing of the offering of debentures is attached to this press release.
To view The WeedMD release, please visit:
About MMJ Group Holdings Ltd
MMJ Group Holdings Ltd (ASX:MMJ) is a global cannabis investment company. MMJ owns a portfolio of minority investments and aims to invest across the full range of emerging cannabis-related sectors including healthcare, technology, infrastructure, logistics, processing, cultivation, equipment and retail. For MMJ's latest investor presentation and news, please visit: http://www.mmjphytotech.com.au/investors/
MMJ Group Holdings Ltd