The company will add to its international portfolio by buying the rest of its Australian partner for C$4 million worth of shares.
A Canadian cannabis company with an international focus has fully acquired its Australian division in an all-share deal.
The deal will cost MPX just over 7 million common shares. These shares will be granted in three separate blocks based on achieved milestones by the Australian division.
According to MPX, the full payment of shares will be staggered based on material achievements completed by MPX Australia, including the issuance of a cannabis license, the completion of its Launceston facility and a successful first harvest.
Scott Boyes, chairman, president and CEO of MPX, said in a press release that the company will now run operations in seven international markets: Canada, Australia, South Africa, Malta, Switzerland, England and Israel, where it will be part of a joint venture.
The executive added that this acquisition will be the basis for MPX to serve the Asian cannabis markets.
The Australian division of MPX is currently pursuing a medical cannabis license from the Australian Office of Drug Control to operate a facility to be built in Tasmania.
A projection from an analyst earlier this year indicates the Australian medical cannabis market will generate revenues of AU$36 million by the end of 2019.
The research, put together by Matthijs Smith, an analyst with Canaccord Genuity’s (TSX:CF) division in Australia, also projects that 11,600 new patients will be registered for medical cannabis use in 2019. “Our back-of-the-envelope calculations suggest that up to 500,000 Australians may benefit from using cannabis products for medical purposes,” he said.
Shares of MPX closed at a price of C$0.42, representing a decline of 1.17 percent, during Tuesday’s trading session. As of Wednesday’s (July 24) opening bell, the decline in value continued as the company took a loss of 1.19 percent.
At the time, the all-stock merger between the US division of the company and iAnthus allowed MPX to begin exploring business operations at the international stage.
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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.