MediPharm Labs Begins Restructuring Following Acquisition Of VIVO, Reduces Non-Direct Labor Workforce By ~30%

MediPharm Labs Corp. MEDIF LABS MLZ provided an update on progress made on the integration of VIVO Cannabis Inc.'s VVCIF operations following the completion of its plan of arrangement with VIVO, pursuant to which MediPharm acquired all of the issued and outstanding common shares of VIVO in an all-equity business combination transaction effective April 1, 2023.

Initial Cost Savings

Following completion of the transaction, MediPharm Labs has executed on initial steps to achieving positive EBITDA synergies between $7 million to $9 million on an annualized basis.

The company has now implemented its plans to reduce the combined MediPharm and VIVO non-direct labor workforce by approximately 30%, since the announcement of the transaction. It is expected that all headcount related savings will be fully implemented within four to six months. This is in addition to restructuring efforts made separately by both companies in 2022. As a result of these efforts, total non-direct labor headcount between both companies will have been reduced by approximately 45% as compared to January 2022.

Restructuring has been implemented at all levels including the C-Suite. Senior executive level positions have now been reduced by 50% as compared to January 2022. These senior level changes represent the largest portion of employee related cost savings and position a leaner senior management team to deliver on operational objectives.

Michael Bumby Appointed to the Board of Directors

Dr. Michael Bumby has been appointed to the MediPharm Labs board of directors. Michael served as the CFO of VIVIO for over 5 years prior to the transaction.

David Pidduck, CEO, MediPharm Labs stated, "We are excited about the VIVO integration, and were committed to giving our employees and customers organizational clarity as early as possible. I want to recognize the many talented leaders and employees who have helped build both organizations over the years. The newly combined team is now focused on improving profitability by both driving revenue and reducing costs."

Photo by Esteban López on Unsplash

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