Canadian cannabis producer The Flowr Corp. is selling its subsidiary Holigen Holdings, which owns twos cultivation facilities in Portugal, to U.K.-based medical marijuana company Akanda Corp. in a deal worth roughly 35 million Canadian dollars ($28 million).
The purchase price includes CA$3.75 million in cash, 1.9 million Akanda shares, Akanda’s assumption of debt worth CA$5.1 million and interim funding to Holigen, according to a Wednesday news release.
Akanda will also buy CA$1 million of Flowr shares in a private placement.
Holigen owns RPK Biopharma Unipessoal, which possesses cannabis facilities in Sintra and Aljustrel, Portugal.
In a statement, Flowr interim CEO Tom Flow said the deal will give the company “a significant amount of cash on closing to solidify its balance sheet and also preserve the upside related to our European operations.”
Flowr pulled out of a number of international cannabis markets in 2021.
Akanda described Holigen’s two Portugal facilities as “a high-quality 20,000 square foot indoor EU GMP certified grow facility… dedicated to the cultivation of high-THC premium cannabis” and a large outdoor grow facility.
“Portugal is one of the EU’s leading jurisdictions to conduct cannabis business with a forward-looking government, in addition to a responsive regulator,” Akanda CEO Tej Virk said in a statement.
“The government has been actively discussing the advancement of legalization of adult-use cannabis and Akanda is dedicated to our presence in the country as the landscape continues to evolve.”
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Flowr trades on the TSX Venture Exchange as FLWR.
Akanda trades as AKAN on the Nasdaq exchange.