Biome Grow announces conditional approval for listing on the Canadian Securities Exchange
TORONTO, Aug. 27, 2018 (GLOBE NEWSWIRE) — Biome Grow (“Biome” or the “Company”) is pleased to announce that Orca Touchscreen Technologies Ltd. (CSE:OAA) (“Orca”) has received conditional approval from the Canadian Securities Exchange (the “CSE”) for the listing of the common shares in the capital of the Company (the “Common Shares”) upon closing of the previously announced three-cornered amalgamation transaction (the “Transaction”) among Biome, Orca, and 151856 B.C. Ltd. (“Orca Sub”).
Closing of the Transaction and the listing of the Common Shares is subject to a number of conditions including, but not limited to, the satisfaction of all closing conditions pursuant to the Amalgamation Agreement (defined below), the completion of all remaining CSE filing requirements, and the receipt of final approval from the CSE.
Biome entered into an amalgamation agreement in respect of the Transaction with Orca and Orca Sub on April 25, 2018 (the “Amalgamation Agreement”), pursuant to which Orca Sub, a wholly-owned subsidiary of Orca, will acquire all of the issued and outstanding securities of Biome in exchange for securities of Orca. A copy of the Amalgamation Agreement and a press release announcing the transaction can be found on SEDAR under Orca’s profile. Per the news releases available on www.biomegrow.com and SEDAR under Orca’s profile, the proposed transaction was approved separately by the shareholders of Orca and Biome at their shareholder meetings held on June 27, 2018 and June 28, 2018 respectively.
Trading in common shares of the Company under the proposed symbol BIO will commence upon closing of the Transaction, which has been conditionally approved. Upon closing of the Transaction, the Board of Directors of Biome will be comprised of J. Mark Lievonen, Stephen Poirier, George Smitherman, Brett James, and interim Chief Executive Officer Khurram Malik. Bios for all Board members can be found on Biome’s website at www.biomegrow.com.
This press release does not constitute an offer to sell or a solicitation of an offer to buy securities in any jurisdiction. The securities mentioned herein have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States except pursuant to an applicable exemption from such registration requirements.
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BIOME GROW Investor Awareness Event – Presentation by Khurram Malik, Co-Founder & Interim CEO
Board members that have signed onto this company include;
Steven Poirier, formerly of Moosehead Breweries with deep connections to the all the provincial liquor control boards and knows how to build a company and brand tied to an adult consumable (i.e. wine and beer) in Canada.
George Smitherman, former Ontario health minister is a very passionate and visible advocate for the liberalization of cannabis in Canada. His years in Ontario politics can be expected to be very useful as the provinces are more actively involved in the ever evolving regulations.
Mark Leivonen is key to Biome’s medical strategy. Mr. Malik believes that most of the product innovation will come on the medical side.
Brett James has regulatory experience in Canada, particularly with respect to Health Canada as the company expands their regulated production/distribution footprint in Canada. Since he has a background in public relations he will also be involved in messaging with respect to Biome.
Meet the Board of Directors
Cannabis Daily had the EXCLUSIVE chance to speak with Khurram Malik, interim CEO of Biome Grow. He answered our questions and gave us a look at the future of this company.
CD: What is your general outlook for the cannabis industry and your role in it as legalization expands?
KM: We expect it to go from a small medical market to a multi-billion-dollar recreational market. Medical will still be there and continue to grow. There will be enough supply in the early days, because large licensed producers are sitting on inventory and stocking their vaults in anticipation of October 17 (when recreational goes live). However, in a few weeks after that, we expect there to be a supply shortage that will last into 2020. Once supply and demand normalizes in 2020, we expect the number of licensed to dramatically decrease—from over 200 to less than 20 viable platforms. Biome is being built for a post 2020 reality to survive the shakeup and thrive on the other side of it. We will have a defensible platform in Canada that will be entrenched in Atlantic Canada, but the bulk of our sales in 2-3 years will come from international jurisdictions.
CD: Considering how many other enterprises are developing in your space as competitors, what distinguishes your business from them?
KM: What do we do better? We are a more efficient platform when it comes to deploying investor capital. After having helped build some of the larger licensed producers, we know and when to spend money and when not to. And just importantly where to spend it. Also, having worked and studied the sector from before the inception of MMPR/ACMPR, we know where there are gaps in this young industry that we try to fill (much less competition in these gaps).
CD: How has the company been financed in the past?
To date it has been financed by individual investors along with a small number of institutions. We try to get influential investors to come on board whenever we enter a new province—it is one of the key cogs we have in building local ecosystems in the provinces where we are focused in. So we would do a Nova Scotia and then Newfoundland round of financing. We will be relying on the more traditional institutional investor market on a go forward basis as well.
CD: How much will the current round/RTO bring in?
It will bring in between $15-$20m.
CD: What are the intended directions for expansion of your company post-raise?
KM: The capital will be sufficient to achieve licenses in four provinces along with working capital. We will do a larger financing after listing and announcing several additional fundamental developments (expected to be at a much higher valuations).
CD: What do you expect your production to be and where do you plan on expanding?
KM: We will be producing indoors and greenhouses (about 50/50 across the whole system) depending on the province. We also have several hundred acres of farm land tied to license/applications which will also facilitate outdoor grow. We have the capacity to produce 2,500 kg in 2018, 12,000kg in 2019 and over 30,000kg in 2020. We are currently developing facilities in Nova Scotia, Newfoundland, Prince Edward Island, and Ontario. We will be announcing plans for NB shortly. We have a license in NS. We anticipate licenses in NL and ON later this year. We build our facilities in phases. By the end of 2019 we plan to have about 400k sq ft of indoor/greenhouse grow space in our four announced facilities. Factoring in outdoor grow in Canada and international jurisdictions, the production footprint will be considerably larger.
CD: What will be the key differentiation points in your business? Focus on quality? Price? Production efficiency? Export?
KM: We anticipate having one of the lowest production costs in Canada. Even our indoor facilities use a highly automated approach that allows for low production costs. So our key advantage will be the efficiency of our production assets that will be able to grow at low cost while achieving a high quality in a predicable fashion (this is not possible without automation that is sorely lacking in the Canadian market). And our international cash flows almost right away in 2019 will make us dramatically different than other Canadian cannabis companies.
CD: When do you anticipate profitability?
KM: We expect to be profitable in 2019.
CD:Where do you see your company in 5 years?
KM: It will be a global platform that will be headquartered in Canada. Most of our sales will be medi