OrganiGram Holdings Inc. (TSXV:OGI) (OTCQX:OGRMF) has closed its previously announced private investment in Eviana Health Corporation (CSE:EHC). OrganiGram is a leading licensed producer of medical marijuana, but what is Eviana? Let’s dig into the OrganiGram Eviana deal.
OrganiGram Closes Deal With Eviana
Serbian-based Eviana creates high-quality, organic cannabinoid (CBD) from “natural hemp strains of cannabis sativa.” CBD is an invaluable asset in products such as high-potency CBD oils, pharmaceuticals, nutraceuticals, topical creams, and health products.
The company is a vertically integrated business and, as such, executes all phases of production to ensure high-quality CBD extraction using leading industry methods. It operates out of Serbia on a 100 hectares of agricultural land where it is growing hemp.
Due to its license, it has easy access to the European market, where there is significant demand for high-level CBD.
The OrganiGram Eviana Deal
Organigram gave 50% of a $10 million debenture offering by Eviana. The other 50% was met by an “institutional strategic investor” who has not been named.
A debenture offering is backed by the worthiness and reputation of a company rather than any physical assets or collateral.
This new deal shows Organigram’s belief in Eviana’s quality of output and demand, however, such a deal poses a greater risk factor. Perhaps this is why investors are reacting negatively to the news; OrganiGram stock is currently down 3.56%.
OrganiGram and Eviana
Despite the market reaction, both parties seem happy with the deal.
Avram Adizes, Chief Executive Officer of Eviana, stated the following:
“In Organigram we have a strategic ally that will join us as we continue to capitalize on the international CBD market into the future. We have also strengthened our balance sheet as we scale up our production operation and fund our ambitious future growth plans in the international CBD market.”
Canada-based OrganiGram has been eager to spread its footprint internationally. According to Greg Engel, company CEO, its “investment in Eviana represents just the beginning of our international aspirations […] but is representative of our approach to work with trusted local partners to both move quickly with boots on the ground and to navigate regional regulatory issues effectively.”
What do you think about the OrganiGram Eviana deal?
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