Atlas Global To Acquire GreenSeal, Scaling The Production And Sale Of Cannabis Flower For International Markets

Atlas Global Brands Inc. ATL signed a definitive agreement to acquire GreenSeal Cannabis Company, Ltd. and GreenSeal Nursery, Ltd., a privately-owned Ontario-based licensed cannabis producer. GreenSeal is expected to be accretive to Atlas’ international strategy, adding a GACP and CUMCS certified facility with a vertical cultivation model. This is expected to expand the company’s annual production capacity by approximately 3,500 kg and adds a nursery program with hundreds of genetics.

“The acquisition of GreenSeal further solidifies our strategy to bring a wide variety of premium flower to international medical cannabis markets. With our recent announcement of our definitive agreement with Harmony AI Holdings Ltd. and Harmony I.L. Management and Escorting Ltd. to acquire two cannabis pharmacies and a cannabis ‘Trading House’ in Israel, the plan is to accelerate our footprint and uphold our value proposition of offering consistent, quality products to patients globally,” stated Bernie Yeung, CEO of Atlas Global.

The Share Purchase Agreement

Pursuant to the share purchase agreement, Atlas Global will issue up to 11.5 million common shares in Atlas Global to acquire 100% ownership of the issued and outstanding common and preferred shares of GreenSeal. The price of the consideration shares will be equal to the 20-day VWAP of the company’s common shares on the CSE to the date of closing.

Approximately CA$5.5 million in bank debt and CA $600,000 in long-term related party loans will remain with GreenSeal post-closing, repayable from free cash flows generated within the business.

The consideration shares will be subject to a lock-up pursuant to which 15% of the consideration shares will be released every six months commencing on the six-month anniversary of the closing of acquisition, until the 36-month anniversary of the closing of the acquisition. If, however, the average closing price per share for the 20 trading days preceding the releases on the 18, 24, and 30-month release dates is at least $2.00, an additional 5% of the consideration shares will be released on the respective release date, reducing equivalently the final release on the 36-month anniversary.

Closing of the acquisition is subject to receipt of customary closing conditions, including regulatory approvals. The acquisition is expected to close in Q1 of 2023.

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Photo: Benzinga edit with photos by geralt and lindsayfox on Pixabay