This acquisition announcement was originally made on November 10 as reported by Equity Guru’s Lukas Kane. Choom has secured one of the largest national retail networks in Canada, and is prioritizing the development of recreational sales networks over medical.
As such, their subsidiary, Arbutus Brands, has divested 90.2 percent of their interest in Arbutus’s medical marijuana subsidiary Specialty Medijuana Products (SMP). Now Choom is left with a 9.8 percent interest in SMP. With that done, recipients of the 90.2 percent interest in SMP have cancelled share commitments of Choom rather than purchase 37,970,445 common Choom shares.
The specifics of the acquisition are that Choom has issued an aggregate of 1,915,973 common Choom shares, as well as $100,002 to Clarity Cannabis Medical Centre shareholders, while a portion of the Choom shares issued to Clarity shareholders are left in escrow.
“As part of our strategic business plan to be a leading national cannabis retailer Choom has taken the necessary steps to assure our license applications comply with each provincial governing body across Canada. Choom has no plans to be a licensed producer and will focus exclusively on its adult use retail and medical centres, as well as, brands portfolio,” says Chris Bogart, President and CEO of Choom.
In connection with Choom’s recent expansion into the medical cannabis market, they have also set their sights on the retail market. They report 90 lease offers are presently being negotiated with 20 leases secured. Also, they have added two new executives to head up their Ontario retail team. They appointed Dr. Lamar Hanna as senior vice-president of Ontario retail, and David Schenk as regional operations manager in Ontario.
Hanna is a pharmacist who owns five retail pharmacies across southwestern Ontario, as well as various supplementary programs such as travel immunization clinics, in-store testing for cholesterol, and an array of weight-loss programs and medical cannabis consulting services.
Schenk is the former CEO of Caribbean Earth Energy Renewables. In 2018, Schenk started the Clinic Network in Waterloo, and serves as manager of Waterloo Medical Cannabis Clinic. He brings with him experience and honed strategies related to cannabis clinics, staff education and training, client education and day to day managerial experience as it pertains to the operation of clinic and staff operations because of his years in various managerial roles.
“The private retail market in Ontario provides the greatest opportunity across Canada for cannabis retailers. This channel in Ontario is poised to be larger than all the other private cannabis retail channels in Canada combined. The additions of Dr. Hanna and Mr. Schenk will bolster the Choom team by bringing retail operations experience from the highly regulated retail pharmaceutical and cannabis clinic industries. As we approach the opening of the Ontario application portal in December, securing locations, building stores, and developing a team remains our top priorities. With their knowledge and best practices in the retail of controlled substances, Dr. Hanna and Mr. Schenk will greatly expedite Choom’s retail strategy in Ontario,” Bogart said.
Choom has expanded their commercial footprint in highly strategic locations by securing the rights to 68 opportunities across western Canada. This is a total of 50 applications submitted, with 35 development permits spread out across the various municipalities. Presently in Western Canada, there are 10 stores presently under construction with seven more having finished their build-out.
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