REPEAT/Halo Announces Planned $11.5 Million Purchase of North Hollywood Cannabis Dispensary & Cannabis Retail Management Company
Halo Labs Inc. (“Halo” or the “Company”) (NEO: HALO, OTCQX: AGEEF, Germany: A9KN) is pleased to announce it has entered into two Letters of Intent (the “Agreements”), concerning the proposed acquisition of a controlling interest in a North Hollywood (“NOLA”) cannabis dispensary applicant and 100% interest in a retail management company and leasehold for a total combined consideration of $11.5 million (the “Acquisition”).
The Acquisition will be paid on the completion of designated performance milestones using common shares of Halo (the “Acquisition Shares”). Completion of the Acquisition will see Halo one step closer to a ‘Seed to Sale’ model and full vertical integration in California.
- $11.5 million acquisition includes a controlling interest in planned flagship dispensary LKJ11 LLC (“LKJ”).
- The NOLA Store will feature nearly 4,000 square feet, sizeable onsite parking, and a prime location at the northwest corner of Lankershim Blvd. and Hesby Ave.
- Potential to build a delivery service for Studio City, North Hollywood, Hollywood Burbank and the Eastern San Fernando Valley
- Cannabis retail management company Crimson & Black LLC (“Crimson & Black”) includes experienced executive team
- Acquisition to be paid in full using Halo stock with a majority paid upon the completion of designated milestones.
- Preserves Halo’s cash position
- Will enhance the Company’s statewide high-growth plan
Los Angeles is a limited license market and one of California’s largest markets for cannabis products.
LKJ is expected to commence retail sales in the first half of 2020. Halo anticipates this vertical integration will increase revenue and gross margins across all Californian operations. LKJ also provides a foundation to build on for future acquisitions of scalable dispensaries. The Company expects to sign and close the acquisition in Q1 2020.
Commenting, Halo CEO and Co-Founder Kiran Sidhu said, “With the planned acquisition of LKJ and Crimson & Black, Halo will accomplish an important step in its ‘Seed to Sale’ vertical integration strategy. Once the NOLA dispensary is licensed and operational, California will mark the first sales territory in which Halo achieves this goal. Our aim is to adopt this same commercial approach in other regions, across North America and internationally.”