According to a press release earlier today, Namaste Technologies (TSXV:N) (OTCQB:NXTTF) has completed its 49% acquisition of Pineapple Express Delivery Inc. Will this give Namaste stock a much-needed boost?
Toronto-based Pineapple Express is a delivery service specific to the medical and recreational cannabis market in Canada. It seems like a good fit for Namaste's online "everything" cannabis store.
Namaste Stock: The Deal
The agreement was first announced in June 2018 whereby Namaste "entered into a subscription agreement to acquire 15% of the common shares of Pineapple for $1,000,000 which comprised of $850,000 in cash and $150,000 in Namaste common shares."
By December, another 34% of outstanding Pineapple Express shares were added, and the deal was binding.
Now, the deal has closed, and Namaste owns "49% of the issued and outstanding common shares of Pineapple Express."
Deal done. But is it going to do Namaste stock any favors?
Namaste Stock After Pineapple Express
As we covered recently, Namaste has had a rough start to 2019. Only last week, shares dropped to an unprecedented low of $0.73 CAD and, on more than one occasion, bad press has caused investors to sell-off in their droves. Certain days saw declines of 15% in a 24-hour period.
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So Namaste stock needs rescuing—that is certain. And at the time of writing, in pre-market trading, N stock is up 1.32%, selling for $0.77 CAD on the TSXV.
Pineapple Express
The cannabis delivery service has been actively delivering recreational and medical cannabis across all Canadian provinces since October's legalization. Prior to that, the management is said to have "over 10 years of experience offering same-day, 60-minute delivery services in multiple industries across Canada."
Because the cannabis industry is so young, so too is Pineapple's experience delivering the drug. It no doubt has the means to provide an effective service, but knowing the true scale of demand is very early to tell. Country-wide delivery does sound like a good addition to Namaste's overarching aim to provide the "ultimate online customer experience for medicinal cannabis and related products."
A bit more time needed, and we will see if the Pineapple acquisition can boost Namaste stock.
What are your thoughts? Is this a wise acquisition for the ailing brand?
Featured Image: Canva
