IMC Completes Acquisition of Trichome and Establishes Global Growth Platform for Both Adult and Medical Cannabis Markets – New Cannabis Companies

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TORONTO, ON and GLIL YAM, ISRAEL / ACCESSWIRE / March 18, 2021 / IM Cannabis Corp. (the “Company” or “IMC”) (CSE: IMCC), (NASDAQ: IMCC), a multi-country operator (“MCO”) in the medical cannabis sector with offices in Israel, Germany and Canada is pleased to announce the completion of the Acquisition of Trichome Financial Corp. (“Trichomes”), which was announced on December 30, 2020 (the “Transaction”). The transaction was completed under a schedule of agreement under the Business Corporations Act (Ontario). The transaction will result in IMC entering the Canadian recreational cannabis market, creating a world leader in the adult recreational and medicinal cannabis sector.

Transaction highlights

  • IMC is now the only MCO with established offices in Israel, the EU and Canada.
  • The transaction marks the start of IMC’s North American expansion strategy.
  • IMC’s senior management team now has extensive acquisition and restructuring experience to benefit from the consolidation of a targeted list of attractively valued and highly synergistic assets.
  • IMC’s global platform now includes the adult recreational cannabis market as well as the established medical cannabis distribution channels in Israel through Focus Medical Herbs Ltd. (“Focus Medical”) and in Germany through Adjupharm GmbH (“Adjupharm”).
  • IMC will leverage Trichome’s premium indoor growing capacity to meet the growing demand for premium cannabis as part of IMC’s established international distribution platform.
  • IMC is now expected to achieve an adjusted EBITDA positive result in 2021.

The transaction was conducted under the terms of an agreement dated December 30, 2020 between IMC and Trichome (as amended) which resulted in IMC acquiring all of Trichome’s issued and outstanding shares (the “Trichome Shares”) ”) In exchange for accounting for 0.24525 of one common share of IMC (each full share, one “IMC Share”) for each Trichome Share.

In connection with the close, a total of 10,104,901 IMC shares were issued to former Trichome stockholders, resulting in former Trichome stockholders holding approximately 20.06% of the total number of IMC shares issued and outstanding (based on 50,370,027 IMC Shares issued and outstanding immediately upon closing).

In order to receive their IMC stock, former Trichome registered shareholders must complete the delivery letter sent to them and send it to the AST Trust Company, otherwise following the instructions contained in that delivery letter. Further details can be found in Trichome’s administrative information circular dated February 12, 2021, which was served in connection with the special meeting of the holders of Trichome shares on March 15, 2021 to approve the transaction. A copy of the circular can be found on Trichome’s SEDAR profile at www.sedar.com.

It is expected that Trichome shares will be delisted from the Canadian Stock Exchange (the “CSE”) on or about March 18, 2021. Trichome will also apply to stop acting as a reporting issuer in the countries where it is currently a reporting issuer.

The directors and officers of Trichome, Cresco Labs Inc. (CSE: CL) and Opaskawayak Cree Nation, which owned approximately 34% of Trichome’s outstanding stock, each have lock-up agreements that allow the resale of the assets acquired by these individuals IMC Shares Restrict Closing the transaction with a staggered 1/6 publication of these shares per month for a period of 6 months.

Upon completion of the transaction, IMC will have beneficial ownership and control of 100% of the Trichome shares issued and outstanding. IMC did not hold any Trichome shares prior to the transaction. A copy of the relevant early warning report of IMC’s acquisition of Trichome shares will be filed under Trichome’s profile at www.sedar.com.

Oren Shuster, Chief Executive Officer of IMC, said, “The acquisition of Trichome is an important milestone in our strategy to become a global leader in the adult recreational and medicinal cannabis market.

With the capabilities of our network of cannabis producers and distributors in Israel and Germany, IMC branded products are driving sales, and Trichome’s wholly owned subsidiary, Trichome JWC Acquisition Corp. Our mainstay in Canada’s adult leisure market.

Oren Shuster, CEO of IMC

We are now a truly global company with the size, capabilities and presence to cement and expand our leading international position.

Mr. Shuster continued, “We have seen a significant increase in demand for premium indoor cannabis products in both Israel and Europe, with Israel becoming a leading importer of cannabis in 2020. Grown cannabis and we are already planning to launch JWC products in Israel this year.

“The Trichome team also has extensive experience in acquisitions, restructurings and operations. We plan to use these capabilities to accelerate our growth strategy in North America through strategic acquisition activities for attractively valued assets. Our focus will be on low capital, high return, free cash flow projects that match our philosophy of prudent capital allocation and maintaining a disciplined and lean cost structure, ”Shuster concluded.

About IM Cannabis Corp.

IMC is an MCO in the medical cannabis sector with headquarters in Israel and offices in Israel, Germany and Canada. Over the past decade, the company believes that the IMC brand has become synonymous with quality and consistency in the Israeli medical cannabis market. The company has also expanded its business to provide intellectual property-related services to the medical cannabis industry.

In Europe, IMC operates through Adjupharm, a Germany-based subsidiary and EU GMP certified distributor of medical cannabis. IMC’s European presence is complemented by strategic alliances with various European-wide EU GMP cultivators and distributors in order to benefit from the increased demand for medical cannabis products in Europe and to make the IMC brand and its product portfolio accessible to European patients.

In Canada, IMC operates through Trichome JWC Acquisition Corp. d / b / a JWC. JWC is a licensed manufacturer based in Kitchener, Ontario. JWC sells cannabis flowers, pre-rolls, hash and kief under the JWC and Wagners brands. JWC works to the highest standards of delivering clean, consistent, premium aeroponically grown cannabis products to medical patients and the adult market across Canada and the world.

Consultant

Cormark Securities Inc. is serving as financial advisor and Gowling WLG (Canada) LLP is serving as legal advisor to IMC. McMillan LLP is a legal advisor to Cormark Securities. Desjardins Capital Markets is acting as financial advisor and Torys LLP is acting as legal advisor to Trichome. Dentons Canada LLP is serving as legal advisor to Desjardins Capital Markets.

IMC has also issued a total of 100,916 IMC shares to partially pay off an advisory fee payable in connection with the closing of the acquisition. This consists of 50,391 shares issued to Desjardins Capital Markets and 50,525 shares issued to Cormark Securities Inc.

Original press release

For information on Trichome Financial, see the sponsored company Investor Dashboard.

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Published by NCV Newswire

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