Our roundup of Canadian small-caps of between $100-million and $2.5-billion in market capitalization making news and on the move today.
Conifex Timber Inc. (CFF-T) said it intends to temporarily reduce operating capacity at its Fort St. James, B.C. sawmill starting Jan. 1, 2019, "due primarily to log costs and current lumber market conditions.:
It said the change is expected to continue until about mid-2019, resulting in an estimated 25-per-cent reduction in Conifex’s B.C. lumber production during the period and a temporary workforce reduction of approximately 70 employees.
Under the Supply Agreement, 48North will supply Canopy Growth with dried cannabis, with the total volume estimated to be a minimum of 1,200 kilograms and deliverable over 12 months. Under the financing agreement, Canopy will invest $3-million into 48North and receive 4 million units at 75 cents per Unit. 48North will issue each unit at 75 cents to Canopy Growth for $3-million, representing approximately 3.4-per-cent of the issued and outstanding shares. Each unit will include one common share and one quarter common share purchase warrant. Each full warrant will entitle the holder to acquire an additional common share of 48North for 12 months at a strike price of $1.15 under certain conditions.
"The strategic partnership between 48North and Canopy Growth ... is a testament to the quality, diversity and consistency of our production, as well as the strength of our branding and product development," said Alison Gordon, CEO of 48North. "The $3 million equity financing completes our $10-million private placement and will help us build out our next generation of cannabis products."
Semafo Inc. (SMF-T) said government security forces were attacked on the road between Fada and the Boungou Mine site in the Est region of Burkina Faso. “As a result, four gendarmes and the driver of their vehicle lost their lives,” the company stated. “The incident did not affect operations at the Boungou Mine, located over 40 kilometers away. No Semafo employees were involved in the incident, but senior management continues its discussions with the government regarding the security of the public road. We remain strongly committed to ensuring the highest levels of safety and security for our employees and operations.”
National Access Cannabis Corp. (META-X) announced it has acquired all of NAC Alberta Inc.'s minority interest in NAC Northern Alberta GP and NAC Northern Alberta Limited Partnership for the forgiveness of $192,702 of debt and by issuing 2.2 million common shares of NAC at a price of 69 cents each.
"This acquisition gives NAC 100-per-cent ownership of all cannabis locations in Northern Alberta, other than Second Cup locations, at an attractive valuation, and streamlines the Company's Alberta strategy in a highly prospective area of the province," said Mark Goliger, CEO of NAC. "We plan on having approximately 8 non-Second Cup locations in 2018-2019 in Northern Alberta and see the potential for a sizable footprint in Northern Alberta as we grow to over an estimated 200 retail cannabis locations across the country."
Equitable Group Inc. (EQB-T) announced it has reached an agreement to acquire Bennington Financial Services Corp, “a profitable and growing privately owned company serving the brokered equipment leasing market in Canada.” Bennington has a portfolio of over $400-million of leases managed by a team of 125 professionals, the company stated.
"This transaction furthers Equitable's goal of broadening its reach as Canada's Challenger Bank, with diversification into adjacent markets that complement its other secured lending businesses and broker-led distribution model," its stated.
Equitable said the all-cash transaction will be immediately accretive its earnings, in the range of 35 to 40 cents per share, excluding an acquisition-related IFRS9 provision.
"The estimated final purchase price of $47-million represents a multiple of 1.3 times book value and 6.9 times earnings," the company stated. Bennington will operate as a subsidiary of Equitable Bank.
CRH Medical Corp. (CRH-T; CRHM-N) announced it has acquired a gastroenterology anesthesia practice in Tennessee that provides anesthesia services to one GI ambulatory surgical center. “The transaction was financed through cash on hand,” the company stated. “The acquisition of Tennessee Valley is our second transaction in the state of Tennessee and our fifth transaction of 2018,” stated Edward Wright, CEO of CRH. “We look forward to continue leveraging the strength of our existing anesthesia and O’Regan relationships to expand our anesthesia business further”.
Emerald Health Therapeutics, Inc. (EMH-X) announced a $10.8-million prospectus sale. The company said it has a proposed agreement with a single Canadian institutional accredited investor that will purchase 4 million of its common shares for $2.70 each. The company said intends to use the net proceeds to fund the completion of capital projects, research and development, working capital, and general corporate purposes.
The company reported a net loss of $9.5-million for the quarter ended Aug. 31 versus a profit of $242.1-million a year ago. Adjusted EBITDA was $9.7-million, versus $5.7-million a year ago. "Growth in Adjusted EBITDA for the three month period was primarily attributable to acquired operations and organic revenue growth, partially offset by increased compensation expenses tied directly to the higher revenue and expand," the company stated.
Wayland Group (WAYL-CN) says it will be expanding into Australia through a deal to acquire 50.1 per cent of Tropicann Pty Ltd., a new privately owned Australian company.
“Globalization of cannabis continues, and we are present in relevant markets, with Asia-Pacific now added to our international footprint,” stated Wayland CEO Ben Ward in a release.
As part of the agreement, the company has agreed to make an initial payment of $4.8-million followed by a second payment of $24-million "following certain milestones being achieved, including issuance to Tropicann of a license to cultivate cannabis in Australia."
The company said both payments will be satisfied by issuing common shares “based on then-current market prices, but subject to a floor issue price of $1.65 per common share.”