Pure Global Cannabis Inc. (TSXV:PURE) entered into a binding letter of agreement to acquire 60% stake in Sativa Nativa S.A.S. from Avicanna Inc. for CAD 18.9 million on August 15, 2018. As part of consideration, Pure Global will pay CAD 8 million in cash and CAD 10.9 million by issuing common shares. In a related transaction, Avicanna will also grant Pure Global an option to acquire an additional 15% in Sativa Nativa for CAD 6 million out of which CAD 3 million will be paid in cash CAD 3 million in shares.

The deadline to exercise the option is 24 months after execution of a definitive agreement in respect of the acquisition to be entered into by the parties. Further, Pure Global has also entered into an engagement letter with Eventus Capital Corp., to act as lead agent with respect private placement offering of convertible debentures units for aggregate gross proceeds of up to CAD 10 million, which will be used primarily to fund the acquisition. As of September 17, 2018, Pure Global Cannabis completed a brokered private placement for gross proceeds of CAD 10 million.

The transaction is subject to due diligence, receipt of all required regulatory approvals and consents in Colombia and Canada, and customary conditions for an investment of this nature. Bayline Capital Partners acted as financial advisor to Avicanna.