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Canopy Rivers Announces Completion of $17 Million Financing for Its Italian Hemp Platform - Canapar
TORONTO, Feb. 04, 2019 (GLOBE NEWSWIRE) -- Canopy Rivers Inc. (the “Company” or “Canopy Rivers”) (TSXV: RIV) is pleased to announce that it has completed a subsequent $9.4 million equity investment in its portfolio company Canapar Corp. (“Canapar Canada”), the Canadian parent corporation of Canapar SrL (“Canapar Italy”), an Italy-based organic hemp production and processing platform. The investment aligns with the Company’s global-focused growth strategy and is expected to provide the Company with the opportunity to capitalize on the rapidly expanding European cannabidiol (“CBD”) market.
In December 2018, the Company committed to an investment of $17,400,000 in Canapar Canada as part of a $25,000,000 non-brokered private placement. The investments in Canapar Canada have increased the Company’s ownership position from 35% to 49%, on a non-diluted basis.
As previously disclosed, Canapar Italy is a Sicily-based manufacturer and processor of CBD oil and isolates, which are increasingly used as an input into new commercial products in the health and wellness industries. Canapar Italy has secured more than 1,000 hectares of hemp through its outsource farming model and entered into an academic partnership with the University of Catania’s Department of Agriculture. The company is also advancing its CBD extraction and processing capabilities through its new facility and is expecting to transform 600 metric tons of hemp biomass annually into CBD isolates and derivative products for distribution in Europe. With demand for products that contain natural active ingredients derived from plant extracts increasing significantly, Canapar Italy plans on developing CBD-infused cosmetics, skincare, and beauty products for the Italian cosmetics market, which is the fourth largest such market in Europe, as well as the global market, which provides strong demand for “Made in Italy” brands.
“Canopy Rivers’ investment in Canapar represents a clear validation of our ability to execute on our strategy and the market opportunity in Europe,” said Sergio Martines, CEO of Canapar Italy. “We expect to leverage this financing to enhance value for all stakeholders in Canapar and we look forward to a long-term partnership with Canopy Rivers.”
About Canopy Rivers Inc.
Canopy Rivers is a unique investment and operating platform structured to pursue investment opportunities in the emerging global cannabis sector. Canopy Rivers works collaboratively with Canopy Growth (TSX: WEED, NYSE: CGC) to identify strategic counterparties seeking financial and/or operating support. Canopy Rivers has developed an investment ecosystem of complementary cannabis operating companies that represent various segments of the value chain across the emerging cannabis sector. As the portfolio continues to develop, constituents will be provided with opportunities to work with Canopy Growth and collaborate among themselves, which Canopy Rivers believes will maximize value for its shareholders and foster an environment of innovation, synergy and value creation for the entire ecosystem.
This news release contains statements which constitute “forward-looking information” within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of the Company with respect to future business activities and operating performance. Forward-looking information is often identified by the words “may”, “would”, “could”, “should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” or similar expressions and includes information regarding:the international growth strategy of Canopy Rivers; the expected growth in demand for cannabis derivative products; the rapid growth of the global cannabis market; expectations regarding the business of Canapar Italy; the development and commercialization of hemp in Italy; the ability of Canapar Italy to utilize extraction capabilities for the production of organic CBD oil; Canapar Italy’s ability to generate low-cost, high yield sources of organic CBD oil; the use of CBD oil in new commercial products; the benefits derived from Canapar Italy’s partnership with the Department of Agriculture at the University of Catania; the increasing demand for cannabis-derived products in Italy and the growing global demand for innovative and unique cannabis products; the benefits of the Italian regulatory landscape; Canapar Italy’s ability to seize the CBD-infused product market opportunity; the expected output from Canapar’s facility; Canapar’s ability to leverage the financing to create value for shareholders; Canapar’s partnership with Canopy Rivers; and Canopy Rivers’ ability to capitalize on the rapidly expanding European CBD market. Investors are cautioned that forward-looking information is not based on historical facts but instead reflects management’s expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although the Company believes that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the Company. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are the following: regulatory and licensing risks; demand for cannabis derivative products in Italy; the Italian regulatory framework for the cultivation of hemp and production of CBD oil; Canapar’s ability to execute on its strategy; demand for Italian derived brands; lack of control over operations; compliance with laws; changes in laws, regulations and guidelines; competition; Canapar Italy’s need for additional financing; the difficulty to forecast accurately; cannabis prices; challenging global financial conditions; litigation; government regulation; operating risks involved in the cannabis industry; the ability to attract customers; constraints on marketing; risks inherent in agricultural businesses; product recalls; product liability; reliance on partners; reliance on key inputs; and dependence on suppliers and skilled labour; changes in general economic, business and political conditions, including changes in the financial markets; potential conflicts of interest; the Canadian regulatory landscape and enforcement related to cannabis, including political risks and risks relating to regulatory change; compliance with extensive government regulation; public opinion and perception of the cannabis industry; and the risk factors set out in the joint management information circular of Canopy Rivers Corporation and the Company dated August 8, 2018, filed with Canadian securities regulators and available on the Company’s profile on SEDAR at www.sedar.com.
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information, please contact:
|Canopy Rivers Inc. |
Sr. Director, Investor Relations & Communications
Executive Vice President, Strategy