Serruya Family Leads 26.7 Million Share Liberty Health Purchase at $1.25 per Share from Aphria

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Liberty Health Sciences announces new strategic investors with proven investment experience in cannabis industry
  • Serruya Family enter a purchase and sale agreement that strengthens Liberty’s aggressive growth plans in the U.S.
  • Aphria maintains 28.1% interest in Liberty Health Sciences with 2 of the 5 Directors remaining

TORONTO, Feb. 5, 2018 /CNW/ – Liberty Health Sciences Inc. (CSE: LHS or US OTCBB: LHSIF) (the “Company” or “Liberty”) is pleased to announce today that a group of buyers led by members of the Serruya family (the “Group”) has entered into a purchase and sale agreement with Aphria Inc. (“Aphria”) to purchase all of Aphria’s shares in the Company that are not subject to Canadian Securities Exchange (“CSE”) escrow requirements (the “Transaction) over the course of the next two and a half years. In the initial phase of the Transaction, Michael Serruya, Simon Serruya and Jack Serruya collectively are purchasing 80% of all transferred shares from Aphria individually or through an affiliate. The remaining 20% is being purchased by an affiliate of Delavaco Capital. After the initial phase of the Transaction, due to the escrow requirements, Aphria will retain an ownership position of 28.1% of the issued and outstanding shares of Liberty. The Transaction also includes a call / put option agreement for the remainder of Aphria’s shares in Liberty, which are currently subject to the CSE mandatory escrow requirements. Each purchaser will also sign a promissory note, which guarantees such purchaser’s obligations under on the exercise of the applicable call or put option, as the case may be, under the option agreement. Under the CSE escrow requirements, the escrow conditions will be removed in intervals and will be completely removed by the middle of 2020. Once all of the escrowed shares are divested, Michael Serruya, Simon Serruya and Jack Serruya, directly or through their affiliates will own 80% of the divested shares, and 20% will be owned by affiliates of Delavaco Capital. The Transaction remains subject to receipt of all required approvals from the Florida Department of Health (“DOH”) Office of Medical Marijuana Use.

The Transaction strengthens Liberty’s aggressive growth plans in the U.S. cannabis market by welcoming the Serruya family as new strategic partners with significant U.S. retail and cannabis industry experience. Liberty will benefit from the Serruya’s family’s interest in the Company and the long-term strategic partnership with Aphria, while at the same time enabling Aphria to satisfy the opinions of the Toronto Stock Exchange regarding its investments in the U.S. Liberty’s operations and business plans will continue at full steam in collaboration with Aphria’s founders, and with the Company’s Intellectual Property and Standard Operating Procedures fully intact.

The Serruya family has an impressive track record in transforming and operating leading retail businesses and we welcome their support and guidance as strategic investors.

George Scorsis, Director and CEO of Liberty

Their acumen and expertise will greatly benefit Liberty as we continue to roll out our network of cannabis dispensaries and aggressive growth plans in the burgeoning U.S. medical cannabis industry.

“We believe Liberty Health Sciences has the management team and strategic plan to succeed in the U.S. medical cannabis market, which is why we’re pleased to take on an even bigger investment in this growing company,” said Michael Serruya. “We look forward to working with the team to execute their long-term growth plan and capitalize on the substantial opportunities that lay ahead.”

Liberty will continue to utilize the Aphria brand name and the Aphria Know-How System royalty-free and in perpetuity pursuant to the binding agreements between the Company and Aphria. Retaining access to Aphria’s industry-leading IP and low-cost cultivation processes secures Liberty’s position as a market leader in the cultivation and processing of high-quality, safe and pure medical cannabis to scale, an integral part of Liberty’s aggressive growth strategy. “We are thrilled to continue working with Cole Cacciavillani as a strategic advisor on our cultivation operations,” said Scorsis. “Liberty Health Sciences will now have the benefit of having one of the leading cultivators in the industry on its team as well as one of the foremost retail operators across many different sectors, and I am confident this will be a winning combination for our shareholders.”

During and after the phased sale of Aphria’s interest in Liberty, Vic Neufeld and John Cervini, of Aphria, remain on Liberty’s board of directors, with Mr. Neufeld remaining as the Chair of the Board. “Liberty remains very well positioned to capitalize on opportunities in the U.S. medical cannabis market” said Neufeld. “Their success is a testament to its hard work and strong management team and I look forward to watching their continued success as they forge ahead with aggressive growth plans in the U.S.”

Aaron Serruya, representing the Serruya family, brings deep knowledge and experience with Liberty as a member of the board of directors since the Company’s inception and will also continue in that role.

In connection with the Transaction, Delavaco Group has been appointed as a special advisor to the Company.

For more information on Liberty please visit www.libertyhealthsciences.com

About Liberty Health Sciences Inc.

Liberty Health Sciences Inc. (“Liberty”) is an investor and operator in the medical cannabis market, capitalizing on new and existing opportunities in U.S. states where medical cannabis is legal.  Liberty’s stringent investment criteria for expansion maximizes returns to shareholders, while focusing on significant near-  and mid-term opportunities.  Liberty has an extensive background in highly regulated industries, with expertise in becoming a low-cost producer.  Liberty leverages commercial greenhouse knowledge to deliver high-quality, clean and safe pharmaceutical grade cannabis to patients.

About Serruya Private Equity

Serruya Private Equity Inc. (SPE) is a Toronto-area based, family managed group that invests capital in a broad range of asset classes, with an emphasis on retail and real estate. SPE’s principals have a heritage of experience developing brands and its affiliates currently include global brands Yogen Fruz, Pinkberry and Swensens, with over one billion dollars of worldwide system revenue.

Original Press Release

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Published by NCV Newswire
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