Organigram Acquires THC Soft Chew Manufacturer Edibles & Infusions In $22M Deal
Organigram Holdings Inc. (TSX: OGI) (NASDAQ: OGI) has purchased The Edibles & Infusions Corp. for $22 million.
The Moncton, New Brunswick-bassed company agreed to acquire all of the issued and outstanding shares of the soft chew manufacturer co-founded by AgraFlora Organics International Inc. (Pink: AGRA) and Cavalier Candies CEO James Fletcher.
Organigram agreed to issue 5,045,873 of its shares at $4.36 each payable on deal closing.
It also opted to pay up to an additional $13 million in shares once Edibles & Infusions achieves particular earnout milestones.
Hyperion Capital Inc. provided financial advice to Organigram for the transaction and Goodmans LLP acted as legal counsel.
Organigram said it anticipates significant incremental near-term revenue increases from soft chews.
The first sales of Edibles & Infusions-manufactured soft chews will launch in the last three months of fiscal 2021.
Fletcher, who leads one of Canada's oldest confectionery companies, said the partnership with Organigram will result in Edibles & Infusions realizing "its full potential."
The acquisition is expected to enhance manufacturing diversification and boost Organigram's research and development capacities.
EIC runs a Winnipeg-based, 51,000-square-foot manufacturing facility for the production of cannabis-infused products.
It is "designed to handle both smaller-batch artisanal manufacturing but, more importantly, large-scale nutraceutical-grade high-efficiency manufacturing with a view to gaining EU GMP certification as well," Fletcher said.
Organigram CEO Greg Engel said the purchase of the edibles manufacturer "will continue to provide our consumers access to innovative cannabis products while leveraging Organigram's national sales and distribution network."
Organigram's New Recreational Cannabis Lines: In March, the company kicked off two new recreational product lines, Indi and Edison Cannabis Co.
The first strain in Indi's product portfolio, which is focused on indica cultivars, is Skyway Kush, with THC levels ranging between 20% and 23%. Edison Cannabis Co.'s pre-rolls come in three strains, with THC content ranging between 18% and 24%.
Photo by Esteban Lopez on Unsplash.
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