Creso Pharma has signed a non-binding term sheet to acquire medicinal cannabis distributor Health House International (HHI) in an all-scrip deal valued at A$4.6 million.
Under a scheme of arrangement, Creso will issue approximately one share for every two in HHI giving HHI shareholders a circa 7.3% interest in the combined group and valuing HHI at $4.6m based on Creso’s current share price.
Both firms are in trading halts pending capital raise announcements.
The deal is subject to due diligence, shareholder and court approval and is scheduled to complete in November.
Creso Pharma group CEO and MD William Lay said it would “significantly strengthen” the firm’s global distribution capabilities and unlock new markets in the UK, Europe and Australia.
He added: “The company will investigate other potential opportunities including HHI’s existing EU-GMP product manufacturing capabilities and how these can further benefit [Creso subsidiaries] Mernova, SSH and Creso Switzerland.”
In June, plans for Zelira Therapeutics to buy HHI were called off after both parties walked away blaming changed market conditions.