Red White & Bloom and Aleafia Health have entered into a binding letter agreement whereby the company has agreed to acquire Aleafia and its subsidiaries in a business combination transaction.
Under the terms of the agreement, each outstanding common share in the capital of Aleafia will be exchanged for 0.35 of a common share in the capital of the company (each, an “RWB Share”), subject to customary adjustment (the “Exchange Ratio”). Upon the completion of the transaction, existing RWB shareholders are expected to own approximately 76% of the combined company resulting from the proposed transaction and Aleafia shareholders are expected to own approximately 24% of the combined company.
The agreement provides for the parties to enter into a definitive arrangement agreement setting out the final terms and conditions of the proposed transaction, at which time additional information will be provided in a subsequent press release.
“The intended acquisition of Aleafia expands our footprint to the largest federally legal cannabis market globally," said Brad Rogers, CEO and Director of RWB. “Combining our award-winning brands and IP with Aleafia’s proven cultivation, manufacturing, and distribution capabilities, creates one of the most dynamic cross border companies in the industry. We continue to focus on delivering significant value to our shareholders and believe this transaction aligns with that commitment.”