MONTREAL, Feb. 19 /CNW Telbec/ - Arura Pharma Inc. (TSXV: ARP) ("Arura")
is pleased to announce that its Board of directors has authorised a strategic
re-organisation of Arura's commercial activities in order to unlock value for
its shareholders. Arura will now mainly focus on its established manufacturing
and distribution of consumer health products unit in health, personal hygiene
and beauty aids while keeping a separate economic interest in the promising
Speciality Pharma business unit.
As part of this exercise, Mr. Daniel Pharand, current chairman of the
Board of directors of Arura, has accepted to take on the function of Executive
Chairman, while Mr. Ali Moghaddam has accepted to terminate his functions of
Chief Executive Officer and director of Arura effective immediately in order
to perform a successful spin-off of the speciality pharma activities of Arura.
Mr. Pharand declared that "the ongoing and anticipated level of activity
of the established business unit manufacturing and distributing consumer
products, with its record sales levels, commanded a level of focus of human
and financial resources incompatible with the full development of its emerging
speciality pharma business unit. The board would like to thank Mr. Moghaddam
for his contribution to Arura and wish him success with the spin-off of the
speciality pharma business unit". Mr. Moghaddam noted that "following the
acquisition of Silkit Pharma Corporation, the speciality pharma business unit
now requires its independent pure-play structure to obtain exposure to its
primary markets to fully develop its late-stage products and innovative
platform and to be able to create value for Arura shareholders as investors."
Mr. Pierre Fortin, Chief Operating Officer of Arura and in charge of its
health and beauty operations added that "Arura will benefit from the addition
of Mr. Pharand in an executive role, with his 25 years of experience in the
manufacturing and pharmaceutical distribution industries in senior accounting,
finance and investment positions. The re-focusing will also permit to
concentrate on our vertical integration and to continue the development of new
geographical markets for our key products such as the Neolia, Light Blue Shade
and Karités brands, while focusing on both top and bottom lines".
As part of the refocusing on its core activities, Arura has converted its
common shareholdings in Arura Speciality Pharma Inc. ("ASP") and in Silkit
Pharma Corporation ("Silkit") in preferred shares having an aggregate
redemption value equal to its aggregate investment at cost, namely one million
dollars ($1,000,000), while the common equity in these corporations has been
transferred to Mr. Ali Moghaddam at its nominal fair market value in a view of
completing the spin-off of the speciality pharma projects. In addition to the
preferred shares which are subject to retraction and immediate repayment or
conversion into common equity in the event of liquidity transactions (such as
listing of ASP shares on an exchange, change of control or similar
transactions), Arura kept the exclusive north American distribution rights in
the vaginal moisturizer to be developed using the Silkit platform and will
receive 50% of the EBITDA derived from the current pipeline of ASP and Silkit
products during a 36 month period, in consideration of which Arura committed
to invest up to $200,000 in consideration of Preferred Shares of ASP over a
7 month period conditional on ASP not being able to obtain adequate financing
within that period.
The Reorganisation is subject to regulatory approval including that of
the TSX Venture Exchange as well as other customary closing conditions.
About Arura Pharma Inc.
Arura operates an established consumer health business unit manufacturing
and distributing health, beauty and personal hygiene products in Canada, in
the United States, Mexico and in Asia. Arura products, including the Neolia,
Light Blue Shade and Karités brands, are distributed in most of the major
pharmacies, warehouse type stores and food retailers.
The products manufactured or distributed by Arura consumer products
business unit can be found on the web site of this division at:
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this press release.
Cautionary Statement on Forward-Looking Information:
This release contains certain "forward-looking statements" including,
without limitation, expectations, beliefs, plans and objectives regarding the
potential transactions and ventures discussed in this release. Among the
important factors that could cause actual results to differ materially from
those indicated by such forward-looking statements are the risks inherent in
pharmaceutical manufacturing and distribution, the need to obtain additional
financing, the availability of needed personnel and fluctuations in general
For further information:
For further information: Daniel Pharand, Executive Chairman, Arura
Pharma Inc., (514) 984-4431, email@example.com,
www.laboratoirecosmepro.com; Ali Moghaddam, President, Arura Specialty Pharma
Inc., (514) 770-3400, firstname.lastname@example.org