The hemp company’s 2020 two-year business plan estimates that the operation will generate more than €3 million in its first year
Inc () (OTCPINK:EURPF) announced Tuesday that it has closed a 5% equity stake in Farmhus GmbH, an outdoor hemp facility near Dresden, Germany.
Farmhus owns more than 500 hectares of land available for hemp cultivation in the area, which is scalable to 2,000 hectares with an option agreement. It has roughly 110,000 kilograms of hemp biomass currently in storage and utilizes specialized machinery capable of harvesting 50 hectares per day.
The hemp company’s 2020 two-year business plan estimates that the operation will generate more than €3 million (US$3.3M, or C$4.6M) from the sale of hemp oil, cosmetics and pet food in its first season of operation.
READ: EuroLife Brands finalizing deals to acquire hemp retailer CEW European Holdings and a stake in German cultivation facility Farmhus
"Our goal to build out a vertically integrated enterprise in the health of wellness sector took a monumental and logistically significant step forward today,” EuroLife CEO Shawn Moniz said in a statement. “With the investment into a hemp supply chain operation run by the experienced team at Farmhus, EuroLife gains a stake in a key physical asset in Europe for the growing health and wellness markets.”
In exchange for its 5% stake, EuroLife will issue 500,000 common shares at a price of C$0.50 per share, for a total of C$250,000, in addition to C$35,000 in cash. EuroLife has the right to increase its stake up to 20%, the company said.
Farmhus’ machinery harvesting machinery is able to extract and separate seeds from stems using a mechanically induced vacuum process with negative pressure, the group added, and it also operates specialized drying machinery.
"EuroLife now has an equity ownership of a highly tactical asset located in Germany,” Moniz said. “We will leverage our position to ensure a supply of affordable and consistent quality raw materials for many hemp-based products sold online and through potentially owned or related physical retail locations."
The Farmhus deal builds on EuroLife’s existing European presence. In April, the company announced it had signed a letter of intent to acquire CWE European Holdings Inc, a seed-to-sale hemp CBD business that operates HANF Hemp stores in Germany and Luxembourg.
Contact Andrew Kessel at [email protected]
Follow him on Twitter @andrew_kessel
