MONTREAL, Feb. 5, 2018 /CNW Telbec/ - LGC Capital Ltd. (TSXV: LG) ("LGC") is pleased to provide an update on its proposed investment in Jamaican cannabis company Global Canna Labs Limited ("Global Canna Labs").
Senior LGC management has now completed an on-site inspection of the Global Canna Labs' facilities in Montego Bay, Jamaica, as part of the investment due diligence process.
Greenhouse frames are installed for the first 28,000 sq. feet with all materials now on site to complete the initial 58,000 sq. feet build-out to full operating status. Installation of the greenhouse irrigation system has commenced, and the 6-acre security fencing and the security CCTV network is now fully operational. (See Figures 1 and 2)
LGC considers that the timelines for Global Canna Labs converting its conditional Cultivator's Licence (Tier 3) (over 5 acres) to a full unconditional Cultivator's Licence and the planting of its first commercial crop by April 1, 2018 are achievable and may be completed before that date.
LGC management was also shown a number of suitable retail sites in Montego Bay and Negril that are under negotiation to launch Global Canna Labs' first Jamaican dispensaries.
John McMullen, CEO of LGC commented, "Jamaica has a well-established cannabis brand with its Rastafarian culture deeply entrenched in the country. Jamaica has the ideal climate, soils and water for the production of a natural "sun grown" medical cannabis product range and Global Canna Labs' operations at Montego Bay are well situated to enable exports to anywhere in the world through Montego Bay's international airport. The Tier 3 Cultivator's Licence, once granted, will put Global Canna Labs in a strong growth position in Jamaica, as its Tier 3 status will allow for expansion opportunities well beyond the 102 acres currently being considered in the Montego Bay area and the 7 acres already secured at Kingston. LGC sees this investment as a very exciting, short-term commercialization opportunity and we look forward to completing the remaining due diligence and moving to close this transaction."
On January 26, 2018, LGC announced that it had signed a Letter of Intent with Global Canna Labs and one of its major shareholders, which provides that LGC will subscribe for a $2.5 million secured debenture, convertible into an initial 30% strategic interest in Global Canna Labs, and that LGC will also acquire a 5% royalty on Global Canna Labs' net sales for $2 million, payable in shares of LGC.
The Letter of Intent provides that LGC will carry out an accelerated due diligence review, to be completed by February 15, 2018, and that upon successful completion of due diligence, the parties will enter into definitive agreements by February 25, 2018.
Closing of the transaction with Global Canna Labs is also subject to the parties entering into definitive agreements, to standard closing conditions, and to regulatory approval, including that of the TSX Venture Exchange.
Global Canna Labs is a Jamaican entity with its head office located in Kingston, Jamaica, with operations based in Montego Bay, with plans to become one of the leading cultivators and processors in Jamaica of cannabis for medical and recreational purposes. Target production is expected to total 1,876 kg in 2018 and rising quickly to 7,741 kg annually by 2021. These production targets can be rapidly expanded from current targets should demand exceed supply.
The Montego Bay site comprises a 22-acre plot with an additional 80-acre expansion opportunity on the same plot. The location is only 10 minutes from the Montego Bay airport and sea port providing logistics access for facilitating global exports.
Global Canna Labs is in the final stages of acquiring a full commercial cannabis license in Jamaica enabling clinical trials, dispensaries, recreational sale, and medical export. On December 20, 2017, the Cannabis Licencing Authority of Jamaica granted conditional approval for a Cultivator's Licence (Tier 3) (over 5 acres).
Construction of its first 58,000 sq. feet of greenhouses is in progress and is nearing completion, with 4 additional acres of outdoor growth and state-of-the-art processing facility meeting GMP and ISO standards in the current site plan. Security fencing around the initial cultivation site covering 6 acres in total has already been installed.
Construction of Global Canna Labs' first dispensary is expected to start in Q1 2018 in Montego Bay's Hip Strip. Plans are also in place for Global Canna Labs to open an on-site farm store and its first dispensary in Kingston by the end of 2018.
LGC Capital Ltd. is a Canadian incorporated public company listed on the TSX Venture Exchange (TSXV: LG). LGC's objective is to become a diversified business group with core business divisions that provide shareholders with exposure to a diverse range of businesses, products and services.
Information Relating to Global Canna Labs Limited
All information contained in this press release relating to Global Canna Labs Limited has been provided to LGC by Global Canna Labs Limited. LGC has relied upon this information without having made independent inquiries as to its accuracy or completeness and assumes no responsibility for any inaccuracy or incompleteness of such information.
FORWARD-LOOKING STATEMENTS This press release may contain forward-looking statements with respect to LGC Capital Ltd. ("LGC") and Global Canna Labs Limited, and their respective operations, strategy, investments, financial performance and condition. These statements generally can be identified by use of forward- looking words such as "may", "will", "expect", "estimate", "anticipate", "intends", "believe" or "continue" or the negative thereof or similar variations. The actual results and performance of LGC and Global Canna Labs Limited could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Some important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, government regulation and the factors described under "Risk Factors and Risk Management" in LGC's Management's Discussion and Analysis for the fiscal year ended September 30, 2016, as filed on SEDAR (www.sedar.com). The cautionary statements qualify all forward-looking statements attributable to LGC and persons acting on its behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release and neither LGC nor Global Canna Labs Limited has any obligation to update such statements, except to the extent required by applicable securities laws.
Caution Regarding Press Releases Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE LGC Capital Ltd
For further information: John McMullen, Chief Executive Officer, Tel.: (416) 803-0698, Email: [email protected]; London contact: Anthony Samaha, Chief Financial Officer, Tel.: +44 (0) 20 7440 0640; Investor Relations: Dave Burwell, The Howard Group Inc., Tel.: (403) 221-9015, Toll Free: 1-888-221-0915, Email: [email protected]