Canada's Wayland Group (CSE:WAYL) is taking over the Northern Territory in Australia with a mutil-million dollar acquisition. The news has excited the region, but what about investors? WAYL stock is currently in the red, so it seems investors aren't biting on this deal.
WAYL Stock: A New Acquisition
A newly-formed company called Tropicann, based in Darwin, is the subject of the acquisition. Wayland Group has its sights set on acquiring 50% of this company, expanding its reach in Australia by doing so.
WAYL stock is still trading at a low of $1.20. At its height, it was selling for double that earlier in the year.
This news exemplifies the company's goal to become a "truly global cannabis company." But investors don't seem to think it is worth the cost and perhaps that's because Tropicann is so new; it has yet to even receive its cultivation license yet.
Deal Terms
Wayland Group has agreed to pay $4.8 million CAD upfront, and a further $27.5 million should Tropicann obtain this cannabis cultivation license in Australia.
It seems that location is exactly what Wayland CEO Ben Ward is after, saying that the Northern Territory was "the ideal location for our new Asia Pacific hub."
He continued:
"The location provides Wayland with ideal climate conditions in a globally respected and sovereign country with a large and fast emerging market of over 250 million people just four hours north."
But approval still needs to be met from stock exchanges, at least two-thirds of WAYL stockholders, and other "applicable approvals."
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NT Government
And it's not only Wayland that is excited about this deal. The Government of the Northern Territory has expressed its support of the deal. Aware of the potential industry it will bring to the region, Chief Minister Michael Gunner said the following:
"We're very excited to see a potential new industry in the Northern Territory [...] We are working with [Wayland Group] around Major Project Status, they are looking to purchase private sector land [...] So this is incredibly exciting, we know this is a growth market for Australia and we're working with [Wayland] on that investment for local jobs."
Giving this project Major Project Status shows the potential that is felt across all parties for this deal. Let's see how WAYL stock reacts to this deal.
Featured Image: Depositphotos/© garagestock
