The company is seeking a 51% interest in ALPS and the 100% acquisition of the outstanding membership interest in Green Therapeutics
() () said Tuesday it is progressing well towards the completion of its proposed acquisitions of ALPS and Green Therapeutics LLC (GT).
Australis is seeking a 51% interest in ALPS and the 100% acquisition of the outstanding membership interest in Green Therapeutics, which includes the discontinuation of all previous litigation with Green Therapeutics.
“As per the Company's commitment to keep our shareholders fully informed and apprised, we are expecting to enter into definitive agreements with ALPS in short order,” the Nevada-based company said in a statement.
READ: Australis Capital acquiree ALPS inks deal to build a high-tech California greenhouse
Australis said that it and ALPS have agreed to extend the completion of the definitive agreements to February 22, 2021.
Australis also noted that the GT transaction is advancing, and definitive agreements are being drafted to meet applicable regulatory requirements. Both Australis and ALPS expect the transaction to close first; Australis expects the GT closing to follow shortly thereafter.
The acquisition of GT is contingent on approval by the State of Nevada's Cannabis Control Board and subsequent local approval by the Clark County Department of Business Licensing.
ALPS
Australis noted that ALPS is engaged in a number of projects incorporating innovation and new intellectual property. One such project is with a Scandinavian grower of tomatoes and cucumbers. At this new facility, ALPS has developed an ultra-precise environment control system, significantly improving propagation success rates and therefore economic output. ALPS retains the rights to the intellectual property developed and will be able to use this technology in the cannabis sector.
"The project in Scandinavia, where we developed a new micro-precision climate control system is a great showcase of how our innovations have immediate commercial applications,” said Thomas Larssen, president of ALPS. “We are proud of this innovation and look forward to seeing the results as new facilities incorporating our innovations come online and deliver the enhanced return on investment our customers have become accustomed to."
Since the Australis/ALPS transaction was announced on January 5, 2021, ALPS has signed four contracts for combined revenues in excess of $5 million with Cann Group, Australia; Aldershot Greenhouses, Canada; US-based Bluehouse Greenhouse; and US-based Vertical Harvest.
Green Therapeutics
Australis said GT continues to turn out exceptional, high-end products. Three of the company's cultivars, sold under the GT Flowers brand, have tested for high potency with exceptional terpene profiles.
The high quality of these products, due to GT's science-based approach to cultivation, is reflected in GT products consistently selling out in the Nevada adult usage space in which GT has achieved a 52% penetration rate, the company said.
Additionally, GT is in the process of operationalizing assets in Missouri and Oklahoma.
In Missouri, GT has completed work on a processing and manufacturing facility in which GT principal and Australis Interim CEO Dr Duke Fu holds a 25% ownership stake, and is in the process of securing distribution for GT's brands. It is anticipated that Australis will obtain this ownership interest at a future time as GT remains on target to commence production at its facility in Oklahoma in the second half of calendar 2021.
"Being able to consistently produce connoisseur cultivars that deliver exceptional potency and superb terpene profiles is an achievement that we are rightly proud of,” said Dr Fu. “We believe that the combined Team with AUSA, and through them with ALPS, will enable us to execute on the scale-up of our brands. This combination will provide consumers and patients across the US with access to our unique product portfolio."
Body and Mind investment
In other company news, Australis said that (), in which the company holds a material ownership interest, recently announced record revenues for its fiscal first quarter of 2021 ending October 31, 2020. Revenues were $5.3 million, up 144% sequentially from 4Q of FY2020 and up by 267% year-over-year.
Clearview Capital Consult contract
The company also said it has retained Clearview Capital Consult to assist it with its investor relations efforts. Founded by Marc Lakmaaker, former VP of IR and director of corporate development at Aurora Cannabis Inc (NYSE:ACB), the group noted that Clearview brings a deep understanding and network in the cannabis industry and the capital markets.
“We worked with Marc for several years at Aurora where he did an exceptional job in crafting and connecting the Aurora story with its stakeholders,” said Terry Booth, who is expected to be appointed as CEO of Australis upon completion of the acquisition of ALPS.
“The appointment of Clearview is fully in line with AUSA's promise to run an active IR program, and I look forward to working with Marc and his team as AUSA continues to execute and inform its shareholders and the markets on its progress, execution and achievements."
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