PharmaCielo Ltd. PCLO PCLOF revealed its plans to acquire cannabis operations in Thailand.
What Happened
On Wednesday, the Canadian parent of Colombia’s premier cultivator and producer of dried flower and medicinal-grade cannabis extracts, PharmaCielo Colombia Holdings S.A.S., announced it had signed a binding letter of intent to enter a proposed transaction to acquire 100% of the issued and outstanding shares of Siam Ventures Corporation in exchange for common shares of PharmaCielo equaling to CA$3 million ($2.2 million).
Under the deal, the sum will be payable on closing via the issuance of 13,636,363 PharmaCielo Shares to Siam Ventures' shareholders on a pro-rata basis.
The deal comes amidst significant shifts in Thailand’s cannabis regulation landscape. Recent developments indicate a potential rollback on recreational marijuana use, as Health Minister Cholnan Srikaew highlighted the government's hesitance to swiftly ban recreational cannabis, citing the need for broader consultations, as recently noted by Benzinga's Patricio Liddle.
Why It Matters
PharmaCielo said the acquisition of Siam Ventures, which provides contract manufacturing services through a subsidiary, will "act as a gateway to large Asian markets for PharmaCielo products."
“This proposed acquisition will provide PharmaCielo with a ready pipeline for its high-quality product as large Asian markets begin to open to cannabinoids," said Marc Lustig, chairman and CEO of PharmaCielo.
Louis Desmarais, lawyer, chairman and CEO of Siam Ventures, agreed to join PharmaCielo's board of directors upon closing of the acquisition.
"We have chosen to join with PharmaCielo, and to invest our capital alongside Marc and other insiders, because we believe that PharmaCielo has all the key attributes required for success in international markets – a deep shelf of high-quality products, a proprietary genetics bank, in-house pharma-level formulation expertise, low incremental cost to scale, and a structural cost advantage," Desmarais said.
PharmaCielo, among the best Latin American brands in the industry, entered the emerging market and knows how to position itself. Beniznga celebrated the most recognized Latin American cannabis companies during its previous cannabis events.
The Benzinga Cannabis Capital Conference is returning to Florida at a new venue in Hollywood on April 16-17.
Non-Brokered Private Placement Of Units
Simultaneously, PharmaCielo revealed it's undertaking a non-brokered private placement of 9,090,909 units at CA$0.2 per unit, under the listed issuer financing exemption.
Each unit will consist of one PharmaCIelo common share and one common share purchase warrant of the company, for gross proceeds of CA$2 million. Each warrant entitles the holder to purchase one common share at a price of CA$0.30 for 24 months.
The company has the option to increase the size of the offering to CA$3 million, or an additional 4,545,455 units.
Closing of the offering may occur in one or more tranches and is subject to regulatory approvals from the TSX Venture Exchange.
PharmaCielo officials stated the company plans to use the net proceeds from the offering to finance general working capital requirements, expand international markets, and streamline the production of its products based on customers’ demands.
The Benzinga Cannabis Capital Conference is returning to Florida, in a new venue in Hollywood, on April 16 and 17, 2024. The two-day event at The Diplomat Beach Resort will be a chance for entrepreneurs, both large and small, to network, learn and grow. Renowned for its trendsetting abilities and influence on the future of cannabis, mark your calendars – this conference is the go-to event of the year for the cannabis world.
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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