Body and Mind Inc. (CSE: BAMMl; US OTC: BMMJ) is about to expand into California with the acquisition of Green Light District Holdings, Inc.
Via a $4 million loan from Australis Capital Inc. (CSE: AUSA), Body and Mind will invest $5.2 million into Green Light with a senior secured convertible note. The note is convertible into just under 89% of the company’s shares.
Although based out of Vancouver, Body and Mind (BaM) currently operates primarily in Ohio and Nevada. The deal will see operations move into California as well, as Green Light District Holdings owns the ShowGrow dispensary and corresponding ShowGrow app.
ShowGrow is currently licensed for recreational sales in Las Vegas, medical sales in Long Beach, and has received a conditional permit in San Diego, with a storefront set to open there next year.
The deal sees ShowGrow CEO David Barakett joining the Body and Mind umbrella, and includes $6.2 million in earn out shares set aside for Barakett as company milestones are met.
Body and Mind Chief Executive Officer Leonard Clough issued a press release about the deal and had this to say:
“Our gratitude goes to the team at Australis, who worked tirelessly in assisting us in getting this deal completed within a one-week period. Australis not only provided BaM with a secured credit facility, but also agreed to exercise approximately 3.2 million warrants to allow us to maintain a responsible debt to equity ratio.”
Clough added, “This is a demonstration of how the Australis and BaM relationship benefits both our shareholders. Secondly, I am happy to welcome David to our team and believe that this opportunity is multi-dimensional as it provides a benefit to almost all our business segments.”
Australis Chief Executive Officer Scott Dowty further commented:
“This deal provides BaM access to a tremendous market beyond Nevada and Ohio, and the ability to leverage the BaM brand further. David Barakett’s experience in the industry is also a great addition to an already strong management team at BaM. ”
Body And Mind also just appointed Trip Hoffmann as the company’s new Chief Operating Officer last month, and further closed an $8 million investment deal with Australis, which saw Scott Dowty joining the BaM board of directors.