Mota Ventures Corp out of Canada has signed a binding letter of intent to acquire Jamaican cannabis grower and extractor, Tropical Verde Coast Ltd, as it targets the Caribbean cannabidiol or “CBD”oils market.
CBD oil is a derivative of hemp and is being increasingly used for its medicinal benefits and is effective at treating a range of ailments. Based on its medicinal value CDB oils can potentially address conditions from sleep disorders to chronic pain to dealing with discomfort from cancer treatment.
Tropical Verde is an arms-length party licensed cultivator with a focus on cultivation and extraction of cannabis as well as distributing cannabis products in herb shops, dispensaries and health and wellness retail locations across the Caribbean.
“With the addition of Sativida to the company’s portfolio, we continue to increase shareholder value by bringing on companies that have existing revenue.”– Mota Ventures CEO, Joel Shacker
Mota Ventures to acquire 49% stake
As a result of the acquisition, Mota Ventures said it will indirectly hold a 49% stake and a 95% net profit royalty in Tropical Verde, which possesses a Tier 1 Cultivator’s license in Jamaica to produce cannabis for medicinal purposes.
“This transaction shows Mota Ventures strategic commitment to becoming a low cost producer and distributor of high quality CBD products globally,” said Mota Ventures CEO, Joel Shacker in a statement. “The Caribbean region is a very large emerging market with Jamaica leading the way,” Shacker said.
Mota Ventures said Tropical Verde is currently finalising its irrigation systems, fencing and security on five acres of leased property, and anticipates that growing will commence sometime later in the first quarter of 2020.
The company noted that Jamaica has a long and rich history of producing high-quality marijuana products. Jamaica’s outdoor growing conditions, coupled with the availability of unique strains, position it to be a leader in the Caribbean region.
Details of Letter of Intent
Under the letter of intent, Mota Ventures would acquire all of the issued and outstanding share capital of Tropical Verde in consideration for C$5 million, which will be satisfied through the issuance of common shares at a deemed price of C$0.45 per share to Tropical Verde shareholders. The shares will be subject a four-month-and-one-day statutory hold period.
Potential European acquisition
In the meantime, Mota Ventures exploring potential acquisition of European CBD producer, Sativida, whose business reach spans throughout Europe, including Spain, Portugal, Austria, Germany, France, and the UK. The company currently develops a large portfolio of organic CBD oils and cosmetics.
Mota Ventures told shareholders that it had signed a letter of intent with Spain’s Vida Bcn Labs SL and Estonia’s Sativida OU, which are collectively known as Sativida, to explore a potential acquisition.
The European CBD company was founded in 2016 and currently develops a large portfolio of organic CBD oils and cosmetics. It is in the process of expanding its distribution network internationally to include the US, the company reported.
According to Mota Ventures, Sativida’s revenues have grown by an average of 20% month-over-month. The firm said it plans to provide Sativida with contacts to distributors and partners across Europe and North America to allow for rapid expansion of the Sativida brand, as well as logistical and financial support.
Mota Ventures recently completed the acquisition of Colombian cannabis producer, NNZ Consulting Corp, which is licensed to cultivate non-psychoactive cannabis in Colombia through its subsidiary Ihuana SAS. “With the addition of Sativida to the company’s portfolio, we continue to increase shareholder value by bringing on companies that have existing revenue,” the Mota Ventures CEO explained in a statement.
According to Shacker, “the synergies that will be created between Ihuana SAS and Sativida will provide a runway for increased revenue, and sustainable growth,” He added that Mota Ventures expects the Sativida acquisition to be the cornerstone for entry into the European CBD market.
For his part Sativida CEO, Noah Laith was elated at the impending deal saying his company was “excited” to work with Mota Ventures to scale up its growth. “With this acquisition, we will have access to the capital and resources required to achieve our goal of becoming a leader in CBD production and retail across international markets,” Laith said in a statement.
The terms of the acquisition are yet to be finalized and subject to due diligence, the company reported. The consummation of this deal will further cement Mota Ventures thrust to become a large-scale vertically integrated low-cost producer and exporter of CBD products globally.