- Nabis Holdings (CSE:NAB) has terminated a definitive agreement to acquire the Desert’s Finest dispensary in California
- Nabis was supposed to acquire 100 per cent of the outlet for a total consideration of C$7.92 million
- The company said that it will be narrowing its focus given a downturn in the cannabis industry
- Nabis Holdings (NAB) is down 33.33 per cent, with shares currently trading at 2 cents and a market cap of $1.9 million
Nabis Holdings (CSE:NAB) has terminated a definitive agreement to acquire the Desert’s Finest dispensary in California.
The specialty investment company initially announced the agreement in June 2019, which was then revised in October the same year.
The 6,000 square foot, privately-owned dispensary is located in Desert Hot Springs, California. Nabis had hoped that the acquisition would serve as a springboard into the lucrative west-coast market.
However, recent volatility in the cannabis sector has meant that the company will need to refocus its activities. Shay Shnet, CEO of Nabis Holdings, said that the acquisition was no longer the best avenue for growth.
“Given the downturn in the cannabis industry, capital markets are no longer helping fuel growth, resulting in the company narrowing its focus on acquiring assets that fit into our vertically integrated strategy.
“Although the Desert’s Finest acquisition was a great opportunity for us to enter the California cannabis market, acquiring a stand-alone dispensary no longer fits into our strategic plan,” he said.
Under the terms of the agreement, Nabis was due to acquire 100 per cent of the dispensary for a total consideration of C$7.92 million. The purchase price was to be made up of $2.69 million in cash and $5.23 million in one-year convertible notes.
Mark Krytiuk, COO of Nabis, also commented on the termination of the agreement.
“The company remains focused on improving operations and profitability at the recently acquired Emerald Dispensary in Phoenix as well as the Infusion Edibles line of medicated products.
“We are continuing to make progress on building out the Camp Verde facility in Arizona, a 44,000 square foot cultivation, production and fulfillment facility that has also secured all available hemp license classifications,” he said.
Nabis Holdings (NAB) is down 33.33 per cent, with shares currently trading for 2 cents at 11:50am EST.