MMJPhytotech
MMJ Group investee Embark Health enters into business combination agreement with Mesa Exploration Corp
MMJ’s core business is holding investments across along the cannabis value-chain in Australia, Canada and Europe.
MMJ Group Holdings Ltd (ASX:MMJ) (OTCMKTS:MMJJF) (FRA:2P9) investee Embark Health Inc has entered into a definitive agreement with Mesa Exploration Corp in regard to a business combination between the two entities.
The transaction will result in a reverse takeover of Mesa by the shareholders of Embark and the outside date for the transaction is set for March 31, 2021.
This will result in MMJ’s investment in Embark being valued using the listed TSX-V price of the listed entity.
Amended Health Canada licence
On December 7 Embark Health was granted an amendment to its Health Canada licence allowing direct sales of cannabis extracts, cannabis topicals and edible cannabis products from the Embark Delta Inc facility in Delta, British Columbia.
The amendment permits sales of Cannabis 2.0 products directly to Canadian provinces & territories and allows Embark Delta to further expand its existing and future product offerings to the medical and recreational consumer markets with concentrates, extracts and nano-emulsified topical and edible products.
In addition, Embark can now offer white-labelling turn-key manufacturing services to its commercial accounts.
Embark is currently producing Bubble Hash, Dry Sift, Traditional Pressed Hash and Rosin at the Delta facility.
Investment in Embark
MMJ was a foundation investor in Embark Health in July 2018 with that the investment having a book value of $13.6 million and now comprises:
- 3.697 million ordinary shares (around 12.7% shareholding) in Embark Health with a book value of C$2.44 per share;
- Warrants that provide the option for MMJ to acquire a further 1 million shares at C$1.75 each up with maturity date of two years after a Liquidity Event;
- Warrants that provide the option for MMJ to acquire a further 1.2 million shares at C$1.202 each up with maturity date of two years after a Liquidity Event; and
- Warrants that provide the option for MMJ to acquire a further 1.125 million shares at C$4.80 each up with maturity date of two years after a Liquidity Event.