Champignon Brands Inc (CSE:SHRM) (OTCQB:SHRMF) announced a key acquisition on Tuesday that supports the company’s bid to open five new US healthcare clinics in 2020.
The firm, which manufactures and delivers ketamine and psychedelic medicine, is acquiring California-based Wellness Clinic of Orange County Inc in a cash-and-share deal.
Wellness Clinic owns a state-of-the-art ketamine infusion treatment centre within the Mission Hospital’s Laguna Beach location. The clinic is actively involved in research and complementary treatment protocols, Champignon said in a release.
“We are thrilled to begin executing on our North American expansion strategy by acquiring our first US based, revenue generating ketamine centre -- Wellness Clinic of Orange County,” said Dr Roger McIntyre, CEO at Champignon.
“This acquisition represents a major milestone as we begin to accelerate our vision of establishing significant scale and a sizable footprint of integrated ketamine centric clinics committed to providing innovative care and therapeutic options to improve the quality of life of patients suffering from chronic disease states that have failed conventional treatments.”
McIntyre, who was appointed CEO on Monday, implemented and developed the Canadian Rapid Treatment Centre of Excellence, Canada’s first-ever rapid-onset treatment centre for persons with mood disorders.
Wellness Clinic’s Dr Michael Bronson told shareholders that the deal was an “exceptional opportunity” to both collaborate and scale with McIntyre and Champignon.
“We are excited for our patients, both current and future, as we work to provide them with the therapeutic options that they deserve,” Bronson said.
Under the terms of the deal, Champignon will acquire Wellness Clinic in exchange for staggered payments of US$600,000 cash and 1 million shares of the Vancouver-based company. In addition, Champignon will issue another 500,000 shares if Wellness Clinic collects top-line revenue of at least US$1.5 million over an 18-month period following the closing of the deal.
An initial 500,000 shares will be released six months following the closing of the acquisition and the remaining 500,000 shares released 12 months following the deal’s close.
Shares will be issued at a price based on the average trading price of Champignon’s shares on the Canadian Securities Exchange. Champignon's stock jumped 13.1% to C$1.26 on Tuesday afternoon.
--Updated with share price--
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