Adastra Labs Holdings Ltd. (CVE:XTRX) said it has appointed J. Scott Munro as president, chief executive officer and chairman with effect from March 1, 2021.
The company said his appointment follows the resignation and retirement of Andy Hale from the same positions. Adastra added that it wished Hale all the best as he pursues other life passions and ambitions.
It noted that Munro is an experienced venture capitalist, accountant and entrepreneur who has led companies and served in a variety of senior executive roles including CEO, CFO and director in both Canadian and US public and private companies for over 25 years.
READ: Adastra Labs Holdings outlines terms for Phyto Extractions acquisition, updates on hydrocarbon extraction plans
Over the past 10+ years, he has owned and operated private venture capital and consulting firms that provide M&A advisory, going-public transactions, reporting, and other services to private and public companies, including in the Life Sciences sector in which Adastra operates.
"This is an exciting time for Adastra, its employees and shareholders as the company is handed off to a strong management team led by Mr Munro with a good footing to scale the business into the future. It's been a great pleasure and rewarding endeavour in helping to build the company from the ground up to this point in time, while working with its amazing employees and advisors while looking forward to bigger growth ahead," commented Hale in a statement.
Acquisition update for Phyto Extractions Brands
In conjunction with the acquisition of Phyto Extractions Brands, announced on December 23, 2020, Adastra announced that it is considering undergoing corporate re-branding and restructuring prior to closing. As a result, the company said it is entering into voluntary trading halt on the Canadian Securities Exchange (CSE) until completing these actions in preparation to close on the definitive agreement for the acquisition.
Adastra added that it and the vendor have extended the exclusivity period for entering into a transaction to on or before May 31, 2021, and are proceeding with negotiating the entry into a definitive agreement and then closing on the acquisition of a 51% controlling interest in Phyto Extractions Brands that includes a right of first refusal for the company to acquire the remaining 49% interest.
As a condition to close, the company is awaiting receipt of final independent valuations on the respective companies along with a fairness opinion to determine the number of consideration shares to be issued for the acquisition. In addition to any applicable regulatory holding requirements, the consideration shares will be escrowed and released over 24 months from the date of closing which would run concurrently with any regulatory hold periods
Phyto Extractions products have been available in the regulated Canadian cannabis market since December 2019 when they launched 4 SKUs. Since that time, the brand has grown over four-fold to offer 18 SKUs including 0.3-gram disposable vaporizers (vapes) in four strains/flavours, 0.5-gram vaporizing cartridges in six strains/flavours with one kit, recently expanded to the 1.0-gram cartridge format in four strains/flavours, two strains of Live Resin and a unique High-Terpene Full Spectrum Extract (HTFSE) CO2 terp sauce SKU.
Adastra Labs is an agricultural-scale cannabis extraction, distillation and product manufacturer located in Langley, British Columbia at its co-located Health Canada Licensed Standard Processing and Analytical Testing Laboratory (Chemia Analytics) facilities. Chemia Analytics is a wholly-owned subsidiary of the company. Adastra also has pending sales and R&D license applications amendments awaiting imminent Health Canada approval.
The company produces cannabis extracts through its newly commissioned hydrocarbon extractor with capacity up to 450,000 kgs per year. It also produces a variety of extracts, distillate, vape cartridges, live resin and terp sauce branded under Phyto Extractions; with expanded cannabis product lines launching in 2021, subject to receipt of Health Canada sales license addendum(s), including: edibles, beverages, bulk distillate, hydrocarbon extracts (butter, diamond, live resin, shatter, terp sauce, and wax), flower (bags and pre-rolls) and topicals that will serve the Canadian medical and adult-use cannabis markets.
Adastra has completed its final commissioning, certification and site upgrade approvals for its ExtractionTek Solutions MeP XT70 closed-loop hydrocarbon extractor. This extractor is rare in its Canadian certification with production capacity > 400kgs per day of cannabis biomass (hemp and weed) into a variety of hydrocarbon cannabis concentrate products with flexibility to run Propane, Butane, and blended solvents to afford the extractor the ability to produce a variety of cannabis concentrate products. This includes high-THC shatter production capacity > 50kgs per day that well positions the company to leverage the acquisition of Phyto Extractions and its strong grass-roots brand recognition for high-quality and good value cannabis concentrates.
Contact the author at jon.hopkins@proactiveinvestors.com