iAnthus Capital Holdings (CSE: IAN) (OTCQB: ITHUF), which owns and operates licensed cannabis cultivation, processing and dispensary facilities throughout the U.S., has received approval from the Supreme Court of British Columbia to acquire MPX Bioceutical Corp. (CSE: MPX) (OTC: MPXEF).
Under the terms of the arrangement agreement signed in October 2018, iAnthus will acquire all of the issued and outstanding common shares of MPX.
The acquisition remains subject to certain customary closing conditions set out in the agreement. The deal is expected to close on or about January 30.
Under the agreement, iAnthus will combine with MPX in an all-stock transaction with offered equity consideration to MPX shareholders valued at C$835 million before giving effect to MPX International and assuming all of MPX’s dilutive securities are exercised prior to the completion of the transaction.
The agreement represents the first public to public merger transaction in U.S. cannabis history.
The agreement provides that MPX shareholders will be entitled to receive 0.1673 common shares of iAnthus for each common share of MPX held, representing a consideration of approximately C$1.28 per MPX common share, a premium of 30.6% based on the closing price of iAnthus and MPX common shares on October 17, 2018.
In addition, each MPX shareholder will receive common shares of the newly formed MPX International which will hold all of the non-U.S. businesses of MPX.
The combined company, excluding MPX International, will encompass operations and cannabis licenses in 10 states that will permit iAnthus to operate 56 retail locations and 14 cultivation/processing facilities.
As a result of the transaction, iAnthus will add retail and/or production capabilities in Arizona, Maryland, Nevada, California and Massachusetts.
Upon closing of the arrangement, MPX International, MPX’s spin-out company, will hold all of the non-U.S. businesses of MPX and will be focused on developing and operating assets across the global cannabis industry with an emphasis on cultivating, manufacturing and marketing products which include cannabinoids as their primary active ingredient. Initial key assets will include Canadian licensed producer Canveda, the Salus BioPharma Corp. agreement with Panaxia Pharmaceutical Industries Ltd. and 50% of a medical cannabis license application in Australia.
MPX International has applied to list its securities on the Canadian Securities Exchange.