Harborside Inc (CSE: HBOR) this morning announced that it has acquired a majority interest in a dispensary set to operate in San Francisco, California. The initial acquisition will consist of a 50.1% interest in FGW Haight, whom has a conditional use approval to operate a dispensary within the city, with the company having a path to obtaining a 100% ownership of the retail location.
More specifically, the conditional use approval is for the Haight Ashbury area of town, which is both historically and culturally significant. The region is viewed as the birthplace of hippie counter-culture in the 1960’s, with the first ever head shop opening in the area.
The arrangement entered into between Harborside and FGW Haight will see the company purchase the majority interest in the firm for $2,179,350, comprised of cash and stock. $1.27 million will paid to acquire convertible notes in the company representing a 29.1% interest in the entity. The balance of the transaction will see multiple voting shares issued to acquire an additional 21% stake in the firm.
“We’re thrilled to be bringing Harborside’s reputation for high-quality products and excellent retail experiences to the iconic Haight-Ashbury district. Upon completion of the acquisition, build-out and receipt of all necessary approvals, our latest retail location will seamlessly blend elevated, contemporary-industrial architecture with the best-in-class service and unbeatable product selection that Harborside has become famous for. We’re excited to continue engaging with our consumers and delivering strong value for our shareholders.”Peter Bilodeau, Interim CEO & Chairman
In addition to the 50.1% interest that Harborside has taken in the firm, the company has entered into an arrangement to acquire a further 29.9% of the entity, which is subject to regulatory approval. This portion of the transaction will be paid via multiple voting shares (MVS), issued at the greater of $150 per MVS, or the 30 day volume weighted average price of the entity, converted to a MVS basis.
Finally, the company also has right of first refuse to purchase the remaining 20% interest in the asset.
Harborside Inc last traded at $1.50 on the CSE.
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