Company Entering Animal Feed Sector
Process in
Motion for Approval Strategic Partnership with Aurora
VANCOUVER, Oct. 20, 2017 /CNW/ - Hempco Food and Fiber Inc.
(TSX.V: HEMP) ("Hempco®" or the "Company") today
provides an operational update on a new product launch and the
process towards approval of the proposed strategic investment by
Aurora.
Strategic Investment Aurora
The Company has initiated the process towards securing the vote
for approval of the proposed strategic investment by Aurora
Cannabis Inc. ("Aurora"). Upon Aurora's full exercise of its
investment in the private placement and the option to purchase
shares from the co-founders, Aurora will obtain a controlling
interest in Hempco through an over 50% ownership position.
Completion of the strategic investment requires consent from the
majority of the dis-interested (non-controlling) shareholders, as
per TSX Venture regulations.
The Hempco Board recommends that shareholders vote in favour of
the transaction so that the Company may complete its financing.
Details regarding the investment and the Aurora option to purchase
founder shares can be found in the Company's Management Circular
and other documents filed on www.sedar.com.
Hempco to Launch New Animal Supplements Product Line
As part of its whole-crop-utilization strategy, the Company will
be launching a new product line aimed at the animal feed supplement
market for horse and dogs. Hempco has conducted a thorough research
and testing program with specific focus on horse and dog feed
supplements, which included extensive consultation with
veterinarians. The program was in compliance with the standards set
by the Canadian Food Inspection Agency ("CFIA"), and aimed to
assess the viability of developing a line of hemp-based products
that would meet the Low Risk Veterinary Health Products standards,
as administered by North American Compendiums. The program showed a
number of important health and well-being benefits for animals, and
consequently Hempco intends to launch its new product line, PRAISE,
for the dog and horse food supplements market in the next 60
days.
Leadership changes
Per the investment agreement with Aurora, Hempco has appointed
two new board members proposed by Aurora. Steve Dobler, President of Aurora, and
Allan Cleiren, COO of Aurora, have
been appointed to the Board, which now counts seven members, five
of whom are independent. The Company believes that the
addition of Mr. Dobler and Mr. Cleiren to its Board will provide a
broader knowledge-base, network and skill set to help the Company
execute on its growth strategy, as well as strengthen the Company's
corporate governance.
Additionally, the Company has commenced the search for a new
Chief Executive Officer, also per the agreement with Aurora.
A number of candidates has been identified and interviewed, and
Hempco hopes to make this key appointment as soon as reasonably
possible.
Management Commentary
"Having achieved growth rates in excess of 25% per year for four
consecutive years, reaching gross sales of $6.7 million for fiscal 2017 (unaudited), we are
now ready to enter the next phase in our development to
further accelerate growth," said Charles
Holmes, CEO of Hempco. "We look forward to executing on our
partnership with Aurora. Their strategic investment, once
approved by our shareholders, will enable us to complete our
Nisku expansion, providing us with
the capacity to serve a rapidly growing customer base. It will also
provide the funds to enter the animal feed sector, enabling us to
capitalize on a very significant opportunity in a large and growing
market. Finally, we anticipate changes in legislation that will
remove industrial hemp from the Controlled Substances Act and place
it under oversight by the agriculture department. This will
allow for whole-crop utilization, including the extraction of
cannabidiol (CBD), a substance that is associated with a growing
number of therapeutic benefits."
About Hempco
For more than 12 years Hempco has been a
trusted and respected pioneer, innovator and provider of premier
hemp seed foods. Hempco is committed to developing hemp foods, hemp
fiber and hemp nutraceuticals, a "tri-crop" opportunity for
producers and processors. Hempco is expanding its processing
ability to meet global demands in a 56,000 sq. ft. facility located
at Nisku, Alberta. Hempco's
common shares trade on the TSX Venture Exchange under the symbol
"HEMP". Hempco has grown its business significantly and is
generating value and profits for shareholders.
ON BEHALF OF THE
BOARD
Charles Holmes
Chief Executive Officer
HEMPCO FOOD AND FIBER
INC.
charles@hempcocanada.com
This news release includes statements containing certain
"forward-looking information" within the meaning of applicable
securities law ("forward-looking statements"). Forward-looking
statements are frequently characterized by words such as "plan",
"continue", "expect", "project", "intend", "believe", "anticipate",
"estimate", "may", "will", "potential", "proposed" and other
similar words, or statements that certain events or conditions
"may" or "will" occur. Forward-looking statements in this press
release include the Company's anticipation of further growth, its
expectation that continued spot inspections by the Canadian Food
Inspection Agency will strengthen its standing as a trusted
supplier, its intent to achieve the BRC Global Standard for Food
Safety and its efforts to implement these standards at its
Nisku, Alberta facility, its
expectation that the Nisku
facility will be operational by Winter 2017/2018, and its belief
that the investment agreement with Aurora will be approved by its
shareholders and help accelerate further growth. These
statements are only predictions. Various assumptions were used in
drawing the conclusions or making the projections contained in the
forward-looking statements throughout this news release.
Forward-looking statements are based on the opinions and estimates
of management at the date the statements are made, and are subject
to a variety of risks and uncertainties and other factors that
could cause actual events or results to differ materially from
those projected in the forward-looking statements. The Companies
are under no obligation, and expressly disclaims any intention or
obligation, to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as expressly required by applicable law.
The TSX Venture Exchange nor its Regulation Services Provider
(as that term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
SOURCE Hempco Food and Fiber Inc.