(This article has been updated from an earlier version.)
Alberta-based 51st Parallel, an affiliate of Denver-based LivWell Enlightened Health, announced a series of transactions Monday that will result in the creation of LivWell International, the companies said in a news release, setting up both for global expansion.
51st will change its name to LivWell International, and LivWell Enlightened Health will continue to operate out of Colorado under the existing name.
LivWell International will also undertake a reverse takeover of CBi2 Capital, and pending acceptance by the respective exchanges, its shares will trade on both the Canadian Securities Exchange and TSX Venture Exchange.
Jason Kujath, co-founder and president of 51st Parallel, told Marijuana Business Daily that the moves are part of the company’s broader international strategy, with potential expansion markets in the European Union – including Germany.
“We hope to look to the medical markets that are opening up and bring the experience that John Lord (LivWell Enlightened Health CEO) and Mike Lord (LivWell Enlightened Health COO) have built in Colorado to other jurisdictions,” Kujath said.
LivWell’s investment in 51st last fall was believed to be the first time an American cannabis company made a move into Canada to establish an integrated business that offered both production and retail operations.
51st is awaiting approval from Canadian authorities to become a licensed marijuana producer.
Concurrent with the creation of LivWell International, 51st said it plans to undertake a $20 million equity investment in GCH, a Denver-based cannabis brand holding company.
In return, 51st will retain the exclusive Canadian licensing rights to Willie Nelson’s marijuana brands owned by GCH – Willie’s Reserve and Willie’s Remedy.
The company also entered into an agreement with syndicate agents led by Eight Capital and including Cormark Securities, Canaccord Genuity, AltaCorp Capital and Atlas Capital to raise up to 50 million Canadian dollars ($38 million) in financing.
LivWell is a medical and recreational marijuana retailer that operates over a dozen stores across Colorado and Oregon. The company also operates its own cultivation facilities and employs roughly 600 people.
Dean Heizer, executive director of LivWell Enlightened Health, said Canada’s capital and federally-regulated markets are appealing to American marijuana companies facing financial restrictions.
“The opportunity in Canada is a more enticing opportunity because it’s federally legal and we’re not treated like criminals,” said Heizer. “We’re taking intellectual property out of Colorado and monetizing it in Canada, because it cannot be effectively monetized from Colorado.”
He said LivWell is not planning to slow down its expansion strategy in the United States.
LivWell’s deal with 51st does not include the Colorado company’s licensee.
Matt Lamers can be reached at mattl@mjbizdaily.com
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