Latest News & Articles
Cannasouth and Eqalis announce prospective merger
Today Cannasouth announced a binding agreement to advance a potential 50:50 merger with leading medicinal cannabis company Eqalis.
Cannasouth and Eqalis will come together to deliver better outcomes for patients – both locally and globally – by combining IP, technology, research and development, innovation, manufacturing, sales and prescribing capabilities.
Mark Lucas, Cannasouth CEO, says the merger will create a more resilient business, building towards diversified income streams, higher margins and access to a larger capital pool to help the company compete globally.
“Both Cannasouth and Eqalis share the same values when it comes to delivering positive health outcomes to patients. Through collaboration, we can speed up the advancement of technology to bring medicines to market faster,” says Lucas.
“Together, Cannasouth and Eqalis will have greater ability to lead and shape the New Zealand industry and reduce costs to patients.”
Greg Misson, Eqalis CEO, says this partnership will ultimately lead to better health outcomes for patients across Aotearoa through innovation and world leading technologies.
“Cannasouth and Eqalis will jointly undertake capital raising activities to bring approximately $9 million of new capital into the business to accelerate growth and the advancement of technologies which will bring costs down for patients.
“We know the most significant barrier to medicinal cannabis for many Kiwis is affordability. As a combined entity, we’re investing in diversification and eliminating duplication to lower the price of medicinal cannabis for patients,” says Misson.
The cannabis medicines produced by the new merged company will range from simple oil-based tinctures to next generation pharmaceuticals, supported by industry-leading cultivation and production technology.
“We know there’s huge demand in Aotearoa to provide high quality, affordable medicinal cannabis products to the thousands of Kiwis suffering from chronic pain, insomnia and anxiety,” says Misson.
“By improving the speed and quality of our production, we’re able to pass these savings along to patients through reduced cost, which is why the R&D side of our industry is so important.”
Principal terms of Cannasouth and Eqalis prospective merger
- The transaction is to be structured as the purchase by Cannasouth of 100% of the shares on issue in Eqalis (“Eqalis Shares”) from the Eqalis shareholders.
- The value attributable to the Eqalis Shares has been notionally set at $48.8 million.
- The notional sum of $48.8 million will be satisfied by Cannasouth issuing 147,891,069 new ordinary fully paid Cannasouth shares at an issue price of $0.33 per share to the Eqalis shareholders.
- Cannasouth CEO Mark Lucas will continue as Chief Executive of Cannasouth post completion of the merger.
- Eqalis CEO Greg Misson will be appointed Chief Innovation Officer of Cannasouth post completion of the merger.
For more information about this agreement, please click here to view the NZX MAP announcement.
To view the Cannasouth and Eqalis proposed merger fact sheet please click here.