Lifeist Wellness Inc. (OTC:LFSWF) announced on Friday it has entered into a definitive share purchase agreement with 1463663 B.C. Ltd., a newly-incorporated affiliate of Tierra Corp., and the company's Canadian cannabis subsidiaries, collectively referred to as the CannMart Group, to divest and sell all of the shares of the CannMart Group to the buyer for CA$5 million ($3.72 million).
What Happened
Under the deal, the Lifeist agreed to sell all of the issued and outstanding shares of each of the corporations in the CannMart Group for an aggregate consideration of $5 million plus the adjusted value of inventory at the time of closing.
The purchase price payable to the company on closing includes:
$500,000 payable in cash upon closing of the transaction; A $4.5 million senior secured vendor takeback loan with set monthly repayments Common share purchase warrants to acquire up to 9.9% of the equity of Tierra Corp., the parent company of the buyer. Why It Matters
This will allow the company to drive growth in its Mikra Cellular Sciences and Aussie Vapes subsidiaries.
The company said it will focus on opportunities in the nutraceutical space, which in North America alone was worth $88.3 billion in 2022, and is forecasted to grow to $118.7 billion by 2028.
Additionally, Lifeist retained upside exposure to new developments in the regulated cannabis space through purchase warrants in Tierra Corp. and is free to reenter the industry domestically or internationally.
What's Next
“The decision to undertake this transaction is a pivotal step in our broader strategy to fortify the financial position of both Lifeist and CannMart by improving cash flow, streamlining operational costs, and strategically shifting the focus of both entities beyond the constraints of the current cannabis regulatory framework," Meni Morim, the company's CEO, said.
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