VANCOUVER, British Columbia, Jan. 26, 2018 (GLOBE NEWSWIRE) -- Cannabis Wheaton Income Corp. (d/b/a Wheaton Income) (TSXV:CBW) ("Wheaton Income" or "Wheaton" or the "Company") is pleased to announce that it has entered into a binding strategic alliance and streaming agreement (the “Agreement”) with IDP Group Inc. and HMT Solutions Inc. (collectively "IDP") whereby IDP, via a newly formed subsidiary (“CannabisCo”), will become a significant streaming partner to the Company, and the newest participant in the Wheaton Licensing Program.
IDP plans to operate out of their large-scale, wholly-owned former Nestle® Canada plant in Chesterville, Ontario (the “Facility”) that rests on 60 acres of land and hosts an existing 373,000 square feet of building space. The Facility is ideally situated approximately 50 minutes southeast of Ottawa, Ontario in close to proximity to railway and highway access.
IDP brings a seasoned management team with decades of project development experience including indoor agriculture, building design, lighting, HVAC systems, construction and project management and have successfully executed over $1 billion worth of industrial development projects to date. IDP also brings proprietary indoor vertical cultivation methodologies and technologies (which include modular farming and in-house LED lighting) (the “Cultivation Technology”) that they intend to deploy at the Facility which is estimated to increase functional cultivation space by over 200% once fully implemented.
Pursuant to the Agreement, the Company will provide IDP with $12,000,000 in funding related to the initial costs for the Phase I construction of the Facility, currently estimated to be 100,000 square feet of cultivation space and upon successful initial implementation of the Cultivation Technology is expected to yield up to 200,000 square feet of effective cultivation space. The Company also has the option to fund an additional two 100,000 square foot expansion phases (the “Expansion Phases”) of the Facility that, upon completion, will increase the overall Facility cultivation footprint to 300,000 square feet.
The Expansion Phases are subject to the Company completing satisfactory due diligence and the parties mutually agreeing to a construction budget and timeline. In addition, the Company will assist CannabisCo in obtaining its ACMPR licensing (“License”) through its Wheaton Licensing Program by providing CannabisCo with all of the resources and expertise necessary to achieve the License.
As consideration for its licensing efforts and funding commitment, the Company will receive a minority equity interest in CannabisCo and a perpetual stream of 30% of all cannabis (or cannabis-derived products including any cannabis trim) produced at the Facility. The Company estimates that its cannabis stream from Phase I of the Facility will result in approximately 7,500,000 grams of cannabis per annum with a further potential to increase the stream’s output using the Cultivation Technology. The Company will also assist in commercializing the intellectual property related to the Cultivation Technology.
Chuck Rifici, Chairman and Chief Executive Officer of Wheaton Income, stated, “The partnership with IDP is a fantastic addition to the Cannabis Wheaton platform as Hamed and the team bring years of complementary skills and technology to this project. We also look forward to implementing their proprietary vertical cultivation system and custom-made fabricated LED lighting systems that we believe can set new standards for yields per square foot and operating cash costs per gram for indoor cultivation. We believe this to be an exciting and an accretive deal for both parties.”
Hamed Asl, Partner at IDP Group, commented, “We are excited to partner with Chuck and the industry leading Wheaton team on this transformational project for our community. When Nestle left Chesterville 12 years ago, the city lost nearly 300 jobs and we aim to bringing back economic activity to the region. This project is a tremendous opportunity for all stakeholders involved while also providing exposure for our modular farming system and other proprietary technologies, which we believe have the potential to enhance the value of Wheaton and its streaming partners.”
The transaction remains subject to certain conditions precedent including receipt of applicable regulatory approvals and the execution of a definitive agreement which the parties expect to occur within 60 days.
ON BEHALF OF THE BOARD
"Chuck Rifici" Chairman & CEO
About Wheaton Income. (TSX.V:CBW)
Wheaton Income is a collective of entrepreneurs with a passion for the cannabis industry past, present and future. Our mandate is to facilitate growth for our partners by providing them with financial support and sharing our collective industry experience. Our partners all have different visions, voices and brand values, and all share a common goal—to build a world-class industry based on ethics, diversity, quality and innovation.
For more information about investing in Cannabis Wheaton, please visit: http://www.wheatonincome.com
or contact our investor relations team at: 800.980.1314 or IR@wheatonincome.com. Follow up on Twitter @WheatonIncome.
Sarah Bain, VP External Affairs
Notice Regarding Forward Looking Statements:
This news release contains certain "forward-looking information" within the meaning of applicable Canadian securities law. Forward-looking information is frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or information that certain events or conditions "may" or "will" occur. This information is only a prediction. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking information throughout this news release. Forward-looking information includes, but is not limited to: the ability to consummate transactions which are currently in discussions, the Company’s ability to obtain the License, the Company’s ability to obtain a sales authorization for the License and the related timing considerations, the Company’s ability to generate revenue through streaming agreements, requirements to obtain additional financing for the Expansion Phases, timeliness of government approvals for granting of permits and licenses, including licenses to cultivate and sell cannabis, completion of the facilities, where applicable, actual operating performance of the Facility including the successful deployment and scalability of the Cultivation Technology, regulatory or political change, competition and other risks affecting the Company in particular and the cannabis industry generally. Forward-looking information is based on the opinions and estimates of management at the date the information is made, and is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. The Company is not under any obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.