Flora Growth has closed its €2m investment in European cannabis cultivator, manufacturer, and distributor, Hoshi, that will see its products reach the European market.
Toronto-based cannabis cultivator and product producer, Flora Growth, has announced it has closed its investment in Hoshi International, and has increased its fully-diluted ownership in Hoshi through a securities swap. The move will see Flora’s finished cannabis products reach patients in Europe.
Reaching European patients
Under the agreement, Hoshi will use efforts to grant Flora access to its EU-GMP auditors to assist Flora in obtaining EU-GMP certification at its Cosechemos cultivation and extraction facility in Colombia.
President and CEO of Flora, Luis Merchan, commented: “The Hoshi team has developed a strong presence in Europe, and our high-quality, low-cost, medical-grade cannabis products and well-known global brands give both our companies a competitive advantage in one of the fastest-growing cannabis markets in the world.
“We are excited to increase our alignment with the Hoshi management team and believe the partnership will be much greater in scope than only using their Portugal and Malta facilities as a European importation gateway for our Colombian cannabis flower and derivatives.
“Regulatory barriers and the technical requirements necessary to successfully navigate the European cannabis market should not be underestimated. We feel extremely pleased with the experience and expertise that the Hoshi team brings in order for us to quickly get our products to market. With the recent rule changes in Colombia allowing the export of THC and CBD flower, we are looking forward to bringing our premium Colombian flower and derivative products to established markets where there is already significant demand, growth, and the opportunity to generate recurring high-margin sales.”
Flora is set to receive 2,000,000 warrants from Hoshi management to acquire 2,000,000 common shares of Hoshi in exchange for 225,000 Flora common shares in order to strengthen the pair’s long-term strategic alignment and increasing Flora’s stake in Hoshi.
“We are excited to begin working alongside the Flora team and sharing our understanding of the European market while working together to bring to market finished product formats from Flora’s brand portfolio that are suitable for European medical consumers,” added John Aird, CEO of Hoshi.
“Not only has Flora made an investment into Hoshi, but through our securities swap, the Hoshi management team also has a vested interest in the success of Flora Growth and our long-term working relationship.”
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