VANCOUVER, BRITISH COLUMBIA--(Marketwired - Feb. 2, 2017) - Vinergy Resources Ltd. ("Vinergy" or the "Company") (CSE:VIN)(CSE:VIN.CN)(OTCQB:VNNYF) in conjunction with its proposed acquisition of MJ Biopharma (announced December 14, 2016) is pleased to announce that it has signed a Letter of Intent (LOI) to acquire up to 51% of a European multinational plant breeding company ("Target"). The Target has audited annual sales in excess of CAD $14,000,000 and adjusted EBITDA of over CAD $2,000,000.
This development is a major step forward in establishing Vinergy as a leader in the global cannabis industry. The Target is a leading developer of plants and plant genetics and has been providing global customers with various commercial agriculture services for over 25 years. In 2016 they shipped over 35,000,000 plant products to the global marketplace. As part of the acquisition, Vinergy now has access to an extensive catalogue of over 2000 hemp and cannabis strains with the ability to supply those strains to customers globally.
Together with Vinergy, the Target has the capacity to expand rapidly into the hemp, cannabis and cannabinoid (CBD) sectors across Europe. "CBD is revolutionizing the global chronic pain management market and we have determined we can utilize our first mover advantage to take a leading market position in multiple countries," said Mr. Kent Deuters, CEO of MJ Biopharma. "Given the current marketplace dynamics, existing customer base and technology we now have access to; we plan to immediately roll out several new hemp and CBD initiatives. Additionally, it's important for our investors to know that we are diversified and not totally dependent on the cannabis space but have multiple complimentary revenue verticals."
The global CBD market is experiencing significant growth: Europe's market potential for CBDs is estimated to be EUR2 billion as a treatment for chronic diseases, according to a new report by Nova-Institute and HempConsult (both of Germany). The reports reviewed the market for non-psychotropic CBD which is increasingly in demand as a food supplement and pharmaceutical. The Hemp Business Journal estimates the total U.S. CBD market will grow to a $2.1 billion market in consumer sales by 2020 with $450 million of those sales coming from hemp-based sources.
"Our goal has always been to control every step of the production process from genetics, right through to extraction, ensuring only the highest quality extracts are used in the formulation of our strips, time release capsules and other products currently under development for the medical and recreational cannabis space," added Mr. Deuters. The Company will aim to work with large growers and provide access for them to a comprehensive catalogue of cannabis strains.
Terms and conditions of the pending acquisition were not disclosed. The transaction, which is subject to customary closing conditions, is expected to close in tranches, with the first being in Q1-2017.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
The CSE does not accept responsibility for the adequacy or accuracy of this release.
Vinergy Resources Ltd.
Glen Macdonald, Director
Cautionary Statement Regarding "Forward-Looking" Information
The forward-looking information contained in this press release is made as of the date of this press release and, except as required by applicable law, the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking information, whether as a result of new information, future events or otherwise, except as may be required by law. By its very nature, such forward-looking information requires the Company to make assumptions that may not materialize or that may not be accurate. This forward-looking information is subject to known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such information. Information pertaining to the Target has been provided by the Target.