Kiaro Closes Acquisition Of Hemisphere Cannabis and Forecasts Projected Annual Revenue Of $42.7 Million With Gross Profit Of $13.7 Million From 16 Stores
Ryan Allway
September 27th, 2021
News
VANCOUVER, BC, Sept. 27, 2021 /CNW/ – Kiaro Holdings Corp. (TSXV: KO) (“Kiaro” or the “Company”), a national omni-channel cannabis retailer and wholesale distributor, is pleased to announce that further to its news release dated July 13, 2021, the Company completed a transaction (the “Transaction”) with Aegis Brands Inc. (“Aegis”) to acquire all the issued and outstanding shares of its subsidiary, 2734524 Ontario Inc. (dba Hemisphere Cannabis Co. or “Hemisphere”), which comprises a portfolio of 7 excellent retail locations in Ontario (the “Existing Locations”) and two more locations subject to potential future development.
In connection with the Transaction, Kiaro issued to Aegis an aggregate of 61,300,000 common shares of Kiaro (“Kiaro Shares”) and 6,700,000 common share purchase warrants, with each warrant exercisable to acquire one additional Kiaro Share at an exercise price of $0.16, subject to customary adjustments. Aegis is also entitled to receive a further 6,700,000 Kiaro Shares on achievement of certain commercial milestones concerning the Existing Locations within the first year following the closing of the Transaction. As part of the purchase price paid to Aegis, Kiaro also issued to Aegis a secured, non-interest bearing and non-convertible promissory note in the amount of $104,628.90, which is secured against the assets of Kiaro, and is repayable on or before September 24, 2022. Concurrent with the closing of the Transaction and pursuant to the share purchase agreement dated July 12, 2021, Steve Pelton has been appointed as a director of the Company.
KEY TRANSACTION HIGHLIGHTS INCLUDES NEW FORECASTED ANNUAL REVENUE OF $42.7 MILLION
The completion of the Transaction has doubled Kiaro’s retail footprint and allows Kiaro to strategically establish a significant presence in the Ontario cannabis retail market. Combined with Kiaro’s existing cannabis retail portfolio (6 in BC, 2 in Saskatchewan, 1 in Ontario) Kiaro now owns 16 licensed cannabis retail stores. The Hemisphere portfolio adds to Kiaro’s cash generating assets while providing the scale to achieve EBITDA positive returns in the next 12 months.
As a result, the Company expects annual forecasted revenue to increase to $42.7M with a gross margin of $13.7M immediately following closing. Moreover, after the opening of Kiaro’s Kelowna location and the 2 Hemisphere potential development locations, the operational footprint will climb to up to 18 stores.
“The closing of this transaction is monumental for Kiaro. So far this fiscal year, we have more than doubled our retail footprint, from 7 stores in February to 16 stores today. The continued increase in our retail footprint to a potential of 18 stores by the end of the fiscal year will be beneficial for shareholders as we drive towards $50M in target revenue. Kiaro’s past operational successes combined with our objective of exponential revenue and EBITDA growth demonstrate our performance advantage within the Cannabis Industry” stated Daniel Petrov, Chief Executive Officer of Kiaro.
“The management at Kiaro are best in class when it comes to retail professionals. We are happy to have our locations and our investment joined forces with a well positioned company like Kiaro” said Steven Pelton, President and CEO of Aegis Brands Inc.
Haywood Securities acted as financial advisor to Kiaro Holdings Corp. with respect to the Transaction. Kronos Capital Partners acted as financial advisor to Aegis Brands Inc with respect to the Transaction. MLT Aikens LLP acted as legal advisor to Kiaro Holdings Corp. Goodmans LLP acted as legal advisor to Aegis Brands Inc.
Transaction Approvals
The Transaction has largely received all necessary regulatory approvals with only certain customary post-closing deliverables required to applicable regulators.
Kiaro Holdings Corp.
Based in Vancouver, British Columbia, Kiaro is an independent, omni-channel cannabis retailer and distributor. Through existing storefronts across British Columbia, Saskatchewan, Ontario and with the completion of the recent acquisition of Hemisphere Cannabis from Aegis Brands, Kiaro has 16 stores in operation and another two expected by Q1 of 2022. This is in addition to a wholesale distribution division servicing Saskatchewan; ecommerce sites in Canada, the US and Australia; and plans for continued national expansion. Kiaro is driven to introduce new and experienced consumers to a lifelong exploration of cannabis. With more than 70 years of collective retail and wholesale focused experience, Kiaro’s leadership team has a proven track record of growing brands across North America and plans to open multiple retail locations nationwide over the coming years.
Aegis Brands Inc.
Aegis Brands Inc. owns and operates a portfolio of brands including Bridgehead Coffee. For more information, please visit www.aegisbrands.ca or find the Company on Facebook and Twitter.
Erin Richards, (416) 627-5728, erin@hypepr.ca
Forward-Looking Information
This news release contains statements that may constitute “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information may include, among others, statements regarding the future plans, costs, objectives or performance of Kiaro, or the assumptions underlying any of the foregoing. In this news release, words such as “may”, “would”, “could”, “will”, “likely”, “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate” and similar words and the negative form thereof are used to identify forward-looking statements. In this news release, forward-looking statements relate, among other things, to: completion of the Transaction and regulatory and other applicable approvals, proposed retail expansion plans and management’s ability to execute on same, overall growth of the Canadian cannabis market and retail opportunities, the integration and financial projections of combined retail portfolio, the award of new operating permits and licenses in various jurisdictions, and the timing and amount of any dispositions of the Company’s common shares. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. No assurance can be given that any events anticipated by the forward-looking information will transpire or occur. Forward-looking information is based on information available at the time and/or management’s good-faith belief with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond Kiaro’s control. These risks, uncertainties and assumptions include, but are not limited to, those described in the Kiaro Filing Statement dated September 29, 2020, a copy of which is available on SEDAR at www.sedar.com, and could cause actual events or results to differ materially from those projected in any forward-looking statements. Furthermore, any forward looking information with respect to future expansion plans is subject to the qualification that management of Kiaro may decide, and the assumptions that any construction or conversion would not be cost prohibitive, required permits will be obtained and the labour, materials and equipment necessary to complete such construction or conversion will be available. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Kiaro does not intend, nor undertake any obligation, to update or revise any forward-looking information contained in this news release to reflect subsequent information, events or circumstances or otherwise, except if required by applicable laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For more information, visit investors.kiaro.com
For our most recent analyst report, click here
Daniel Petrov
Chief Executive Officer
SOURCE Kiaro Holdings Corp.
This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.
About Ryan Allway
Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.
Search CannabisFN
Press Coverage
Psychedelics Index
Top Videos
Alan Brochstein’s 420 Investor is the go-to community for investors to learn, explore, and profit from the marijuana companies. The main goal of 420 Investor is to provide real-time, objective information about the top marijuana companies in the market in order to help investors capitalize on cannabis.
Matthew Nordgren is an ambitious executive, dedicated philanthropist, and accomplished athlete who brings a unique passion to creating strategic alliances. He has breadth and depth of experience in finance, corporate development, and capital sourcing, as well as in building highly motivated teams of skilled professionals. In 2005, Mr. Nordgren received his education at the University […]
HempFusion is a leading health and wellness CBD company utilizing the power of whole-food hemp nutrition.
ICC International Cannabis’ corporate mandate is to plan, design, build and operate the highest quality, lowest cost Cannabis production, processing and distribution facilities worldwide.
Network Partners
About CFN Media Group
CFN Enterprises Inc. (OTCQB: CNFN) owns and operates CFN Media Group, the premier agency and financial media network reaching executives, entrepreneurs and consumers worldwide. Through its proprietary content creation, video library, and distribution via www.CannabisFN.com, CFN has built an extensive database of cannabis interest, assisting many of the world’s largest cannabis firms and CBD brands to build awareness and thrive. For more information, please visit www.cfnenterprisesinc.com.
Disclaimer: Matters discussed on this website contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. CFN Media Group, which owns CannabisFN, is not registered with any financial or securities regulatory authority and does not provide nor claims to provide investment advice or recommendations to readers of this release. CFN Media Group, which owns CannabisFN, may from time-to-time have a position in the securities mentioned herein and will increase or decrease such positions without notice. The Information contains forward-looking statements, i.e. statements or discussions that constitute predictions, expectations, beliefs, plans, estimates, or projections as indicated by such words as "expects", "will", "anticipates", and "estimates"; therefore, you should proceed with extreme caution in relying upon such statements and conduct a full investigation of the Information and the Profiled Issuer as well as any such forward-looking statements. Any forward looking statements we make in the Information are limited to the time period in which they are made, and we do not undertake to update forward looking statements that may change at any time; The Information is presented only as a brief "snapshot" of the Profiled Issuer and should only be used, at most, and if at all, as a starting point for you to conduct a thorough investigation of the Profiled Issuer and its securities and to consult your financial, legal or other adviser(s) and avail yourself of the filings and information that may be accessed at www.sec.gov, www.pinksheets.com, www.otcmarkets.com or other electronic sources, including: (a) reviewing SEC periodic reports (Forms 10-Q and 10-K), reports of material events (Form 8-K), insider reports (Forms 3, 4, 5 and Schedule 13D); (b) reviewing Information and Disclosure Statements and unaudited financial reports filed with the Pink Sheets or www.otcmarkets.com; (c) obtaining and reviewing publicly available information contained in commonlyknown search engines such as Google; and (d) consulting investment guides at www.sec.gov and www.finra.com. You should always be cognizant that the Profiled Issuers may not be current in their reporting obligations with the SEC and OTCMarkets and/or have negative signs at www.otcmarkets.com (See section below titled "Risks Related to the Profiled Issuers, which provides additional information pertaining thereto). For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. CFN Media Group, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity-based compensation in the companies it writes about, or a combination of the two. For full disclosure, please visit: https://www.cannabisfn.com/legal-disclaimer/. A short time after we acquire the securities of the foregoing company, we may publish the (favorable) information about the issuer referenced above advising others, including you, to purchase; and while doing so, we may sell the securities we acquired. In addition, a third-party shareholder compensating us may sell his or her shares of the issuer while we are publishing favorable information about the issuer. Except for the historical information presented herein, matters discussed in this article contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. CFN Media Group, which owns CannabisFN, is not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this release. CFN Media Group, which owns CannabisFN, may from time to time have a position in the securities mentioned herein and will increase or decrease such positions without notice. For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. CFN Media Group, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity- based compensation in the companies it writes about, or a combination of the two. For full disclosure please visit: https://www.cannabisfn.com/legal-disclaimer/.
Copyright © Accelerize Inc. · All Rights Reserved · Privacy Policy · Legal Disclaimer
