In a groundbreaking move that is set to reshape the landscape of the psychedelic and cannabis industries, Silo Wellness, Inc. (CSE: SILO) (OTCQB: SILFF) (FSE: 3K7A) has announced its intention to acquire NUGL Inc. (OTC Pink: NUGL) (dba Kaya Jamaica) in a transaction valued at $43.3 million.
Silo Wellness and NUGL Inc. executed a binding Letter of Intent (LOI), outlining the terms and conditions of the acquisition. The deal is subject to shareholder approval, and a special meeting will be held to discuss the acquisition, elect a new board, and potentially consolidate shares and change the company’s name.
Silo Wellness will acquire all of NUGL’s issued and outstanding shares in exchange for 2 million shares from its treasury. The purchase price is set at $40.2 million Additionally, NUGL stock options, warrants and other convertible securities will be adjusted to receive Silo Common Shares on an economically equivalent basis.
To validate the purchase price and cover transaction costs, Silo Wellness aims to raise between $250,000 to $2 million through best-efforts private placement financing at 2 cents per share. A finder’s fee of 3 per cent will be paid to both a NUGL board member and Silo’s CEO, amounting to 64.9 million shares each.
Kaya owns three Kaya Herb House retail locations and the Gap Café wellness center. Kaya Herb House Drax Hall near Ocho Rios is Jamaica’s first legal medical cannabis shop and the company’s flagship retail complex. It is also the base for Kaya’s cultivation and processing operations.
Silo Wellness stock stayed flat at $0.01 on Wednesday on the Canadian Securities Exchange.
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The final structure of the transaction is subject to tax, corporate, and securities law advice, as well as regulatory approval from both the Canadian Securities Exchange (CSE) and NUGL. The CSE is expected to halt trading of the stock until shareholder approval is obtained.
The combined market cap of both companies, based on the CAD $0.02/share valuation, would be $43.3 million. NUGL shares are currently valued at CAD $0.0461 (USD $0.0344), and Silo shares are valued at CAD $0.02.
Silo Wellness, offers psilocybin wellness retreats in Jamaica and its founded in Oregon. The company has been featured in several documentaries including
Last August, Kaya and Silo Wellness partnered to integrate Kaya’s psilocybin services where the wellness retreats will offer a comprehensive and varied range of experiences.
