The agreement supplants the letter of intent previously arranged between Primary Energy and NNZ
Primary Energy Metals Inc () (OTCMKTS:PEMTD) has struck up a share purchase agreement with NNZ Consulting’s shareholders to acquire the Colombian licensed cannabis producer.
The new agreement supplants the letter of intent previously arranged between Primary Energy and NNZ. And as part of the arrangement, Primary Energy will acquire all of NNZ’s outstanding shares.
Last July, Primary announced its decision to acquire NNZ Consulting Corp as part of its shift to focus on cannabis.
READ: Primary Energy Metals to acquire NNZ Consulting as it shifts focus to cannabis
NNZ, via its subsidiary Ihuana SAS, is licensed to cultivate, produce and distribute cannabidiol (CBD) based medical grade cannabis in Colombia.
Once the deal is struck, Primary Energy will double down on advancing NNZ’s business and change its name to “Mota Ventures Corp” as it rachets up its foothold in the South American cannabis sector.
Colombia has a suitable climate for cannabis cultivation outdoors as well as low labor and construction costs. The country’s laws on the cultivation and sale of medical cannabis are progressive and it has already granted international export permits for medical CBD.
As part of the take-over, Primary Energy is looking to issue 39,997,500 shares to NNZ shareholders.
In other news, Chad Clelland, who co-founded the Greenleaf Medical Clinic in 2011 and the website MedicalMarijuana.ca, has been tapped to Primary Energy’s board. He replaces Zach Stadnyk who is stepping down to “pursue other ventures”.
Primary Energy Metals also revealed Tuesday that it has reaped gross proceeds of roughly C$3.66 million from its previously announced offering of subscription receipts, which is being conducted as part of the NNZ acquisition.
The financing was oversubscribed and Primary Energy issued 12,196,249 receipts at a price of C$0.30 per receipt. Once the NNZ deal is finalized, each receipt will be converted into one unit of the company, consisting of one common share as well as a single purchase warrant.
