Akanda signs nonbinding deal to sell Portuguese cannabis firm for $2 million

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International medical cannabis company Akanda Corp. has entered into an amended nonbinding letter of intent to sell RPK Biopharma Unipessoal, its Portuguese subsidiary, to Somai Pharmaceuticals.

London-based Akanda said its original deal with Somai has been amended to reflect a lower price – $2 million – down from $2.7 million.

Akanda didn’t say when the original nonbinding deal was struck with Portugal-based Somai or why it was amended.

The deal includes all current liabilities of RPK, which amount to approximately 4 million euros ($4.3 million), Akanda said in a news release.

A $500,000 deposit has been placed in an escrow account as a deposit, with the remainder of the amount due upon successful completion of the proposed transaction.

“The precise terms of the proposed transaction will be negotiated and contained in a definitive agreement,” the release notes.

The duration of the letter of intent has been extended to March 31.

Akanda Corp. acquired RPK in 2022 when it bought Holigen Holdings from The Flowr Corp., a Canadian licensed producer.

The day after the amended nonbinding deal was announced, Akanda said it entered into a securities purchase agreement with unidentified accredited investors.

Gross proceeds to Akanda are expected to be roughly $708,000.

Akanda said it intends to use the proceeds, minus advisory and other fees, for general working capital and corporate expenses.

The investors agreed to purchase 280,851 common shares at a purchase price of $0.406 per share and prefunded warrants to purchase 1,462,991 common shares.

The prefunded warrants are immediately exercisable at any time.

The offering is expected to close Feb. 2.

Separately, in early January, Akanda said it had received an extension of 180 calendar days from the Nasdaq to regain compliance with the stock exchange’s $1 minimum bid-price rule.

The company now has until July 1 to regain compliance – which requires the stock price to close at or above $1 per share for a minimum of 10 consecutive business days.

Akanda has been noncompliant since July 3, 2023.

Shares of Akanda Corp. are traded on the Nasdaq as AKAN.