The key to this agreement is that SMP has already submitted their Affirmation of Readiness evidence package to Health Canada and expect to receive a cultivation license from Health Canada in the next several weeks.
This represents a huge leap forward in the timeline for Choom ahead of legalized recreational cannabis in Canada, as SMP is much farther ahead than the Company's other 2 ACMPR applicants. Once SMP receives their cultivation license the final step will be to acquire the sales license, which they expect to submit for by the third quarter of 2018.
This is is one of the last steps in unlocking the underlying value in ChoomTM as a key player in Canada.
SMP was founded by a seasoned business team with extensive experience in growing cannabis, the operation of pharmacies, medical clinics, land development and construction.
Transaction Highlights
The expected benefits of the Transaction for Choom™ include that it will:
- enable Choom™ to acquire a company in British Columbia that has submitted its AOR evidence package to Health Canada and expects to receive its cultivation license in the next few weeks;
- create significant synergies in operational infrastructure and expertise across multiple disciplines to drive strong growth potential;
- significantly improve and advance operational scale and production capacity; and
- strengthen and accelerate Choom’s strategic direction as a fully-integrated cannabis company, representing a premiere lifestyle brand in Canada
SMP’s marijuana production growth strategy is expected to be executed in three phases:
- Phase I - First Facilities: AOR evidence package submitted to Health Canada: Buildings are at operational readiness with state-of-the-art-facilities, consistent with ACMPR standards, and SMP expects to receive its cultivation license from Health Canada within the next several weeks. A sales license is expected to be granted by Health Canada in the third quarter of 2018.
- Phase II - Second Facility: Expand existing production by constructing an approximately 19,600 sq. ft. facility that will bring total production capacity to over 29,000 sq. ft. in the combined facility footprint.
- Phase III - New Facility: Expand existing production by constructing two additional buildings that will increase the total building gross square footage to just over 700,000 sq. ft. This new facility, a hybrid model of indoor and greenhouse production, is expected to bring Choom’s total production capacity to over 750,000 sq. ft. The Municipality of Sooke has already approved cannabis production zoning for the site. The building expansion fits within the zoning regulations and final planning for this expansion is currently underway.