Vireo Growth (VREO.CN) intends to enter into a securities purchase agreement with BWAB Holdings and certain other parties to buy all of the issued and outstanding membership interests of Bridgewell Agribusiness LLC, including certain of its units, it said on Monday.
The Bridgewell deal could close any time following five business days following the date of this announcement, subject to some conditions, it said. The aggregate consideration for the Bridgewell transaction is based on a base purchase price of US$40 million, subject to adjustments for, among other things, about US$30 million of assumed indebtedness of Bridgewell that will remain outstanding following closing and the assumption of certain other transaction expenses, said the company.
After giving effect to such adjustments, the estimated closing purchase price is expected to be about US$10.3 million, it said. In exchange for the issued and outstanding membership interests of Bridgewell, Vireo will issue an unsecured, subordinated convertible note to the seller in the amount equal to the closing purchase price, which will automatically convert on or after the second anniversary of closing into an estimated 16.6-million subordinate voting shares of Vireo at US$0.62 per consideration share, it added.
Shares of Vireo Growth were last seen unchanged at $0.55 on the Canadian Securities Exchange.