Heritage Cannabis Holdings Corp (CSE:CANN) (OTCMKTS:HERTF) and Empower Clinics Inc (CSE:CBDT) (OTCMKTS:EPWCF) are teaming up to produce hemp-derived CBD oils and formulated products, the companies announced Tuesday.
Using Heritage’s formulations, the joint-venture partnership will produce proprietary branded products for Empower’s health clinics in Washington State, Oregon, Nevada and Arizona, including Empower’s subsidiary Sun Valley Health network that has access to over 165,000 patients.
Under the terms of the agreement, both Heritage and Empower will each own 50% of the partnership.
Heritage subsidiary Purafarma Solutions Inc will install extraction units and downstream equipment at Empower’s hemp processing facility in Oregon. Purafarma will also train and supervise staff on the methods of extraction and oil production that the company produces in Canada.
The partnership will be equally funded by Heritage and Empower, with Heritage investing an initial C$500,000 in the joint venture to build out the partnership and secure hemp from local suppliers.
Steven McAuley, Empower’s CEO, said that moving forward with Heritage allows the cannabis company to execute its growth strategy more quickly and efficiently.
“We will expand our clinics and CBD product offerings throughout the US via our franchise model, as we aim to become a significant part of the cannabis wellness marketplace,” McAuley said in a statement.
READ: Empower Clinics’ subsidiary Sun Valley Health to tout double-digit patient growth at the Franchise Expo in Chicago
Heritage CEO Clint Sharples called the partnership a “big step” for the Canadian company as it expands its capabilities into the US.
“We are fortunate to be working with Empower as they bring distribution, and a licensed facility which will allow us to begin filling an order pipeline immediately,” Sharples told investors in a statement.
"Since our 30% acquisition of Endocanna Health in California, they have introduced us to many quality opportunities, including this one with Empower, and are targeting many more in the future."
Toronto-based Heritage is a vertically integrated cannabis provider that currently has two Health Canada approved licensed producers, through its subsidiaries Voyage Cannabis and CannaCure Corp.
Vancouver-based Empower owns a network of physician-staffed medical clinics in Washington State, Oregon, Arizona and Nevada, treating more than 165,000 patients with a variety of qualifying conditions.
Contact Angela at firstname.lastname@example.org
Follow her on Twitter @AHarmantas