Neptune Wellness Solutions announces agreement for divestiture of cannabis assets
by CM Staff
The Company has reached an agreement with PurCann Pharma Inc., a subsidiary of Groupe SiliCycle, to purchase Neptune's cannabis assets for C$5.15 million to be paid in cash.
LAVAL — Neptune Wellness Solutions Inc., a diversified and fully integrated health and wellness company, announced on Oct. 17 that is has entered into a binding agreement to divest its cannabis business which includes the cannabis plant in Sherbrooke, Québec, the Mood Ring and PanHash brands, and related assets.
The Company has reached an agreement with PurCann Pharma Inc., a subsidiary of Groupe SiliCycle, to purchase Neptune’s cannabis assets for C$5.15 million to be paid in cash.
Neptune intends to use the net proceeds from the sale of these assets to for working capital and other general corporate purposes.
As part of the Transaction, the Company has received an opinion from its financial advisor, Stifel GMP, that the consideration to be received by the Company as part of the Transaction is fair, from a financial point of view. The Transaction is expected to close on or before November 15, 2022, upon completion of standard closing requirements.
Ray Silcock, Chief Financial Officer of Neptune, said, “The complete divestiture of our cannabis business is a critical milestone in executing upon our strategy to become a leading CPG company. We are nearing an inflection point with our flagship brand Sprout Organics and expect it to serve as the key growth driver for Neptune going forward. In addition, the divestment of the cannabis assets will allow us to realize significant cost savings and operational streamlining from redirected resources towards our simplified corporate structure.”
PurCann Pharma is already present in the Canadian cannabis market with its therapeutic brand OOVIE and its recreational cannabis brand OLLOPA. Hugo St-Laurent president of PurCann Pharma says: “With this transaction, PurCann Pharma consolidates its position in the cannabis market and is also aligned with our mission to provide pharmaceutical grade ingredients and cannabinoids to the life science market.”
Neptune has retained Stifel GMP as its sole financial advisor and Osler, Hoskin & Harcourt LLP as legal counsel in connection with the Transaction.