Akanda signs letter of intent to sell RPK Biopharma to Somaí. “It will be one of the few vertical cannabis companies in the EU”, says Michael Sassano

Akanda Corporation, an international medical cannabis company listed on Nasdaq (AKAN) and which owns the Portuguese company Holigen, announced this week the signing of a non-binding letter of intent (LOI) with Somaí Pharmaceuticals, for the sale of its subsidiary RPK Biopharma, based in Sintra. Remember that the Akanda acquired Portuguese Holigen from Flowr Corporation for 26 million euros in April 2021, thus achieving GMP certification in the European Union.

In accordance with the provisions established by the companies, the duration of the LOI was extended until March 31, 2024. Michael Sassano, CEO of Somaí, confirmed to CannaReporter that the amount paid will be 2 million dollars (1.84 million euros), with the assumption of financial liabilities of approximately 4 million in debt from RPK Biopharma. “This includes all real estate holdings and licensing for the cultivation of cannabis in two different locations”, that is, the facilities in Sintra, where indoor cultivation is located, and the greenhouse and outdoor land in Aljustrel, in the municipality of Beja. “Both licenses grow”, guarantees Sassano.

Somaí also intends to continue the partnership with Cookies, announced in September 2022 by Akanda. “We also want to acquire the Cookies licensing rights for the flowers that will enter Germany and the United Kingdom in the second quarter of this year,” Sassano told CannaReporter.

The end result of this operation will be “one of the few vertical cannabis companies in the EU, with indoor and greenhouse cultivation capabilities, the most advanced manufacturing products in all global markets, as well as distribution in Australia and Germany, the global markets numbers one and two, as well as sales channels in the United Kingdom and Poland.” Furthermore, Sassano says that “as newer countries show more progress, we will bring the broadest range of products to these emerging markets.”

Michael Sassano, CEO of Somaí Pharmaceuticals. Photo: Laura Ramos | CannaReporter

According to the CEO of Somaí, “a big difference will be our profitability, since indoor cultivation is a very manageable expense, compared to other vertical sectors, which have massive crops that are basically majority idols and that cost a lot to maintain ”. Sassano also guarantees that “100% of what we produce will be sold out, as it will be the highest quality non-irradiated indoor flower with the Cookies brand. This is a very important differentiation,” he says.

Somaí holds the global rights to Airpro vaporizers and gummies, which is also a leader in the US. “The combination of leading US flowers, from Cookies, and vaporizers manufactured by Airopro, is a powerful fusion for the EU markets, as the biggest North American brands are coming through Somaí to bring the best products developed by more of a decade for patients”, says Sassano.

In alignment with the terms of the proposed transaction, a deposit in the amount of five hundred thousand dollars (459.5 thousand euros) will be placed securely in an escrow account, with the remainder of the amount due upon successful completion of the transaction. The precise terms of the proposal will be negotiated and set out in a definitive agreement. Closing of the transaction will be subject to customary due diligence, representations and warranties, agreements, indemnities and closing conditions. According to Akanda's statement, there can be no assurance that the proposed transaction will be consummated or in accordance with the terms and conditions currently described in the LOI.

The Press Release warns, however, that “the announcement of this LOI does not constitute an offer to sell or a solicitation of an offer to buy Akanda securities, nor shall there be any sale of such securities in any state or other jurisdiction in which such offer, solicitation or sale is unlawful prior to registration or qualification under the securities laws of any state or other jurisdiction. Any offers, solicitations or offers to buy or sell securities will be made in accordance with the registration requirements of the Securities Act of 1933, as amended.”
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[Disclaimer: Please note that this text was originally written in Portuguese and is translated into English and other languages ​​using an automatic translator. Some words may differ from the original and typos or errors may appear in other languages.]