Concurrent with the closing, WeedMD also completed the previously announced private placement of subscription receipts with the Labourers’ Pension Fund of Central and Eastern Canada (LPF), for aggregate gross proceeds of C$25 million.
The issue price of each receipt is C$1.0832, and will be automatically exchangeable into one WeedMD common share following shareholder approval at a meeting scheduled for February 4, 2020, according to a statement.
READ: WeedMD inks blockbuster deal with Starseed Holdings to become major player in the medical cannabis sector
“We officially welcome the Starseed team to the WeedMD family, which together will kick-off 2020 as a very compelling, vertically-integrated cannabis company that will execute across the entire value chain,” said Keith Merker, CEO of WeedMD.
“Starseed’s unique medical distribution platform complements WeedMD’s high-quality cultivation and processing platform. This partnership, along with the C$25 million strategic equity investment by LPF, positions WeedMD and its shareholders with a fortified balance sheet and one of the most captive medical cannabis businesses in the country as we enter the new year.”
Starseed is a medically focused, federally licensed company that provides cannabis for insured patients through their benefit plans.
Starseed gives WeedMD access to a built-in partnership with Canada’s largest construction union to provide medical cannabis as a fully-covered drug benefit for its more than 100,000 members and retirees in addition to their respective dependents.
For Starseed, the transaction means it is able to move off expensive and unreliable third-party supply and instead drawdown on WeedMD’s reliable, low cost and quality product.
WeedMD also said it has integrated Starseed’s management team into its senior leadership as follows:
- Keith Merker, CEO (maintains role)
- Angelo Tsebelis, formerly president of Starseed, assumes the role of president of WeedMD
- Nichola Thompson, CFO (maintains role)
- Stephen Ng, formerly CFO of Starseed, is appointed to chief strategy officer of WeedMD
- Dr Peter Blecher, formerly chief medical officer of Starseed, assumes the role of CMO of WeedMD
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