Zenabis has completed the acquisition of 51% of Hillsboro Corp Inc., a Canadian cultured tea beverage company known for its True Buch Kombucha, adding a new product line
Vancouver, British Columbia – January 29, 2019 – Zenabis Global Inc. (“Zenabis”) (TSXV: ZENA) is pleased to announce that Zenabis has completed the acquisition of 51% of Hilllsboro Corp Inc. (“True Buch”).
True Buch is a kombucha company with expertise in the creation of cultured tea beverages. True Buch cultured tea beverages are raw, unpasteurized, gluten free and non-GMO, with over 11 distinct flavours. Zenabis and True Buch intend to draw upon each other’s expertise to infuse cannabis into True Buch beverages when permitted under applicable laws and regulations, creating a cultured tea beverage CBD or THC product.
Zenabis has acquired 51% of True Buch in consideration of the issuance to the True Buch shareholders of 455,947 common shares of Zenabis. In addition to this closing payment, the True Buch shareholders are entitled to cash earn-out payments based on the future financial results of True Buch exceeding the forecast on which the closing payment was based.
Zenabis has the option, on or after the second anniversary of the date of the agreement, to purchase the remaining 49% of the equity in True Buch at eight times the EBITDA for the preceding 12 months payable in cash (the “Option”).
“The strategic acquisition of True Buch marks a significant milestone for both companies” said Andrew Grieve, CEO of Zenabis. “We are excited to enter into this business arrangement with True Buch for several reasons, with the first among these the opportunity to leverage the expert management and operational expertise being contributed by each of our entrepreneurial teams,” said Grieve. “Zenabis is moving rapidly to augment our existing recreational and medical cannabis product lines with the creation of a new consumer product portfolio, in anticipation of upcoming changes to regulations around the sale of cannabis-infused edibles.”
“We are extremely excited to partner with Zenabis and to work with their successful management team to further enhance their innovation, while maintaining great quality in the national and global cannabis infused beverage space,” said Conrad Ferrel, CEO of True Buch. “Our team looks forward to working with Zenabis on expanding the reach of our already great branded kombucha products into new markets, as well as developing a new line of innovative products for their growing customer base.”
- On January 8, 2019, Bevo Agro Inc. and Sun Pharm competed the reverse takeover announced on October 4, 2018, to become Zenabis Global Inc.
- On January 21, 2019, Zenabis entered into a credit agreement with a major Canadian chartered bank for a $51,000,000 credit facility.
- As of January 28, 2019, 70% of the Zenabis common shares have been contributed to the Pooling Agreement announced December 21, 2018, including 9 of the top 12 shareholders.
- As of January 28, 2019, Zenabis has distribution relationships with government and third- party retailers/distributors in New Brunswick, Price Edward Island and the Yukon Territory.
Zenabis is a significant licensed cannabis cultivator of medical and recreational cannabis, and employs staff coast-to-coast, across facilities in Atholville, New Brunswick; Delta and Langley, B.C.; and Stellarton, Nova Scotia. In addition to gaining technologically advanced knowledge of plant propagation, the recent addition of state of the art greenhouses in Langley provides Zenabis with 3.5 million square feet of facility space that can, upon full conversion, be dedicated to cannabis production.
If all facility space is fully built out and dedicated to production, Zenabis will own, and have access to, 660,000 square feet of high quality indoor cannabis production space, as well as 2.1 million square feet of greenhouse space at its Langley facility (an additional 700,000 square feet of greenhouse space will be used to continue the existing propagation business, to be converted at such a time that is beneficial to the strategic position of the company), strategically positioned on Canada’s coasts. These facilities, if fully converted for cannabis production, would have the design capacity to yield 479,700 kg of dried cannabis annually, for both national and international market distribution. The Zenabis brand name is used in the medical market, while Namaste is used to service the recreational market.
The management team at Zenabis has significant experience in finance, agriculture, technology, pharmaceutical sales, consumer packaged goods, international distribution and brand marketing. Leadership is backed by the expertise of a Chief Growing Officer, a Chief Science Officer and Chief Medical Officer.
This news release contains statements that may constitute “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information may include, among others, statements regarding the future plans, costs, objectives or performance of Zenabis, or the assumptions underlying any of the foregoing. In this news release, words such as “may”, “would”, “could”, “will”, “likely”, “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate” and similar words and the negative form thereof are used to identify forward-looking statements. In this news release, forward-looking statements relate, among other things: the intention of infusing cannabis into True Buch beverages when permitted under applicable laws and regulations to create a cultured tea beverage CBD product; and the conversion, expansion and optimization of Zenabis’ facilities. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. No assurance can be given that any events anticipated by the forward-looking information will transpire or occur. Forward-looking information is based on information available at the time and/or management’s good-faith belief with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond Zenabis’ control. These risks, uncertainties and assumptions include, but are not limited to, those described Zenabis Management Information Circular dated November 23, 2018, a copy of which is available on SEDAR at www.sedar.com, and could cause actual events or results to differ materially from those projected in any forward-looking statements. Furthermore, any forward-looking information with respect to available space for cannabis production is subject to the qualification that management of Zenabis may decide not to use all available space for cannabis production, and the assumptions that any construction or conversion would not be cost prohibitive, required permits will be obtained and the labour, materials and equipment necessary to complete such construction or conversion will be available. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Zenabis does not intend, nor undertake any obligation, to update or revise any forward-looking information contained in this news release to reflect subsequent information, events or circumstances or otherwise, except if required by applicable laws.
For more information, visit: https://www.zenabis.com.