Liberty Health Sciences Inc. announced that it has entered into a binding term sheet to acquire all of the issued and outstanding shares of 242 Cannabis Canada Ltd. whose wholly-owned subsidiary 242 Cannabis, LLC, has agreed to purchase a 387 acre parcel of land in Gainesville, Florida.
The Property includes over 200,000 square feet of state-of-art greenhouses, head houses, tissue culture lab and processing facilities. According to Liberty, the company plans to retrofit the facilities over the coming months which will enable Liberty to expand their production capacity a year sooner than projected in order to meet the growing patient demand in Florida. Patient count continues to increase and at the end of 2017, approximately 64,000 patients had registered with the state, an almost 300% increase in total patients since June 30, 2017.
Upon completion of the retrofit, Liberty will be one of the leading medical cannabis providers in the Florida market with an expected annual capacity of 12,000 Kgs of high quality, affordable, medical cannabis. Use of the facilities as an approved cultivation facility for Liberty under its MMTC license is subject to inspections and/or approvals from the Florida Department of Health, Office of Medical Marijuana Use.
“This acquisition of nearly 400 acres of property shows Liberty’s commitment to provide patients with a consistent supply of high-quality cannabis to meet their medical needs,” said George Scorsis, Director and CEO of Liberty. “Our state of the art facilities will be equipped with the latest in industry leading lighting technology and process automation.”
The proposed acquisition will be completed through a series of transactions. The Company expects 242 Cannabis, LLC’s purchase of the Property and the subsequent purchase by the Company of the 242 Shares to close on or prior to February 9, 2018, and closing is subject to standard due diligence including title, environmental assessments and surveys as well as the satisfaction of conditions precedent in accordance with the purchase and sale contract. As consideration for the 242 Shares, the Company will issue 18,815,322 units of the Company, with each unit being comprised of one common share of the Company and one-half common share purchase warrant, with each whole warrant exercisable at $2.07 for a period of three years from the closing date.
Until such time that the retrofit is completed at the new facility, Liberty will continue to operate their existing 36 acre facility, also in Gainesville. Since acquiring the existing facility, Liberty has made a number of process and automation improvements and expects to complete an increase in growing capacity to 24,000.