Multistate operator Red White & Bloom Brands has moved forward with its bid to buy Aleafia Health, months after a failed attempt to acquire the insolvent Canadian cannabis producer.
Toronto-based Red White & Bloom (RWB) said Thursday it “has been selected as the successful bidder” for Aleafia and some of its subsidiaries through the proceedings under Canada’s Companies’ Creditors Arrangement Act (CCAA).
RWB had previously entered a stalking-horse bid for Aleafia as part of the Canadian company’s CCAA process.
The purchase price put forward in the stalking-horse bid was estimated in an August report by court-appointed CCAA monitor KSV Restructuring to be between 25 Canadian dollars and CA$29 million ($18.3 million-$21.2 million).
The subsidiaries purchased from Aleafia will be transferred to RWB via a reverse vesting transaction, along with “specific intellectual property owned, licensed or leased by Aleafia Health,” RWB said.
Some Aleafia assets and liabilities will be excluded from the deal.
Aleafia, headquartered in Vaughan, said one of the excluded assets is its facility in Grimsby, Ontario, which it has agreed to sell to an unspecified third party.
A hearing for court approval is scheduled for Oct. 27.
Aleafia and RWB anticipate closing the deal in November.
RWB operates in such U.S. markets as Arizona, California, Florida, Illinois, Massachusetts and Michigan.
Aleafia launched a strategic review in May after breaching a loan agreement.
In June, the company announced a deal for its acquisition by RWB.
However, that deal was canceled after opposition by some Aleafia debt-holders.
Producers, retailers and other cannabis-sector companies comprised 40% of CCAA filings in Canada in 2022, and more have filed for creditor protection in 2023.