AgraFlora Organics International Inc. Announces Intention to Launch Takeover Bid for Eviana Health Corporation
August 09 2019 - 5:01PM
AgraFlora Organics International Inc.
(“
AgraFlora” or the
“
Company”) (
CSE: AGRA) (Frankfurt:
PU31) (OTCPK: AGFAF), a growth oriented and diversified
international cannabis company, announces that it intends to make
an offer (the “
Offer”) directly to the
shareholders of Eviana Health Corporation
(“
Eviana”) to purchase all of the issued and
outstanding common shares (the “
Eviana Shares”)
for consideration consisting of common shares of AgraFlora.
The OfferThe Offer will provide holders of
Eviana Shares with 1.694915 AgraFlora shares (the
“AgraFlora Shares”) for each Eviana share based on
the offer price of $0.50 per Eviana share and the closing price of
AgraFlora shares of $0.295 on August 9, 2019.
Reasons for Eviana Shareholders to Support the
AgraFlora-Eviana Combination
- Significant and immediate 49.25% premium to market price;
- Ownership in a larger cannabis entity with higher trading
volumes and poised for further growth;
- Opportunity to put in place proven management to execute the
business plan; and,
- Potential for further downward share price impact if the Offer
is not accepted.
Transaction Merits for the AgraFlora-Eviana
Combination
- 130 hectares of high-quality organic CBD from industrial
hemp;
- Strategic access to the European market;
- Synergies with current AgraFlora products and brands for
Eviana;
- 40,000 sq. ft. processing facility in Mladenovo, Serbia (near
Novi Sad); and,
- Fully-funded 22,000 sq. ft. pharma-grade leased extraction
facility in Belgrade with Vitalis Supercritical C02 Extraction
System
It is expected that following the transactions contemplated by
the Offer, AgraFlora will continue to be listed on the Canadian
Securities Exchange under the symbol AGRA.
Background to the Offer
On July 26, 2019, AgraFlora presented Eviana’s board of
directors (the “Eviana Board”) with a proposal
(the “Proposal”) to explore a mutually agreeable
business combination. Although the Eviana Board failed to respond
to Proposal, AgraFlora would still welcome a transaction supported
by the Eviana Board, and looks forward to engaging the Eviana Board
to deliver significant value to Eviana shareholders. However, at
this time, the rationale for the combination is too strong to
accept inaction.
AgraFlora will be engaging with Eviana shareholders in the
coming days and is hopeful to gain their support.
Questions? Need more help? Eviana shareholders should contact
AgraFlora investor relations at +1 (800) 783-6056 or via email
at ir@agraflora.com.
AgraFlora does not own any shares of Eviana, nor do any of
AgraFlora’s directors sit on the Eviana Board. Eviana has no
related party influence with AgraFlora, nor does AgraFlora have a
related party influence over Eviana.
Intention to Make an Offer
Full details of the Offer are expected to be set out in the
formal Offer and take-over bid circular which is expected to be
mailed to Eviana shareholders, a copy of which is expected to be
available at www.sedar.com under Eviana’s
profile. AgraFlora expects to formally commence the Offer and
mail the Offer and take-over bid circular to Eviana shareholders
over the coming weeks.
Readers are cautioned that AgraFlora may determine not
to make the Offer if (i) Eviana implements or attempts to implement
defensive tactics in relation to the Offer, (ii) AgraFlora uncovers
or its contemplated funding sources uncover or otherwise identify
information suggesting that the business, affairs, prospects or
assets of Eviana have been impaired or uncovers or otherwise
identifies other undisclosed material adverse information
concerning Eviana or (iii) Eviana determines to engage with
AgraFlora to negotiate the terms of a combination transaction
and Eviana and AgraFlora determine to undertake that
transaction utilizing a structure other than a take-over bid such
as a plan of arrangement. Accordingly, there can be no
assurance that the Offer will be made or that the final terms of
the Offer will be as set out in this news release.
The Offer will be undertaken in accordance with National
Instrument 62-104 – Take-Over Bids and Issuer Bids and will be
subject to a number of customary conditions, including: (i) receipt
of all governmental, regulatory, stock exchange and third party
approvals that AgraFlora considers necessary or desirable in
connection with the Offer; (ii) there being no legal prohibition
against AgraFlora making the Offer or taking up and paying for the
Eviana Shares; (iii) Eviana not having adopted or implemented a
shareholder rights plan, disposed of any assets, incurred any
material debts, implemented any changes in its capital structure or
otherwise implemented or attempted to implement a defensive tactic;
(iv) no material adverse change having occurred in the business,
affairs, prospects or assets of Eviana; (v) AgraFlora not becoming
aware of Eviana having made any untrue statement of a material fact
or omitting to state a material fact that is required to be made to
any securities regulatory authority; (vi) approval by the
shareholders of AgraFlora in accordance with the policies of the
Canadian Securities Exchange; and (vii) the statutory minimum
condition that 50% of the Eviana Shares having been tendered to the
Offer and not withdrawn. AgraFlora expects the Offer, when
made, will remain open for not more than 105 days and not less than
35 days from the date of mailing its take-over bid
circular.
Advisors
AgraFlora has retained Haywood Securities Inc. as its financial
advisor and Laurel Hill Advisory Group as its communications
specialist and information agent.
About AgraFlora Organics International Inc.
AgraFlora Organics International Inc. is a growth oriented and
diversified company focused on the international cannabis industry.
It owns an indoor cultivation operation in London, ON and is a
joint venture partner in Propagation Service Canada and its
large-scale 2,200,000 sq. ft. greenhouse complex in Delta, BC. The
Company has a successful record of creating shareholder value and
is actively pursuing other opportunities within the cannabis
industry. For more information please visit: www.agraflora.com.
ON BEHALF OF THE BOARD OF DIRECTORS
Brandon Boddy Chairman & CEOT: (604) 682-2928
For additional information:
AgraFlora Organics International Inc. Tim
McNultyE: ir@agraflora.com T: (800) 783-6056 Shareholders may also
contact AgraFlora’s Information agent:Laurel Hill Advisory
GroupToll Free: 1-877-452-7184Email: assistance@laurelhill.com |
For French inquiries: Remy Scalabrini, Maricom Inc.E:
rs@maricom.ca T: (888) 585-MARI |
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The CSE and Information Service Provider have
not reviewed and does not accept responsibility for the accuracy or
adequacy of this release.
Forward-looking Information Cautionary
Statement
Except for statements of historic fact, this
news release contains certain "forward-looking information" within
the meaning of applicable securities law. Forward-looking
information is frequently characterized by words such as "plan",
"expect", "project", "intend", "believe", "anticipate", "estimate"
and other similar words, or statements that certain events or
conditions "may" or "will" occur. Forward-looking statements are
based on the opinions and estimates 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 anticipated in the forward-looking statements
including, but not limited to delays or uncertainties with
regulatory approvals, including that of the CSE. There are
uncertainties inherent in forward-looking information, including
factors beyond the Company’s control. There are no assurances that
the business plans for AgraFlora Organics described in this news
release will come into effect on the terms or time frame described
herein. The Company undertakes no obligation to update
forward-looking information if circumstances or management's
estimates or opinions should change except as required by law. The
reader is cautioned not to place undue reliance on forward-looking
statements. Additional information identifying risks and
uncertainties that could affect financial results is contained in
the Company’s filings with Canadian securities regulators, which
are available at www.sedar.com.
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