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Marijuana

HEXO (OTCMKTS:HYYWF) Acquires 100% Stake In Newstrike Brands Ltd (OTCMKTS:NWKRF)

HEXO (OTCMKTS:HYYWF) has acquired a 100% stake as per the previously agreed arrangement in Newstrike Brands Ltd (OTCMKTS:NWKRF). The deal comprises all the outstanding and issued shares of Newstrike.

Controls 558.971 million shares

Following the takeover, Hexo gets control over 558.971 million shares of Newstrike and representing a 100% stake.

Chief Executive Officer and co-founder of Hexo, Sebastien St-Louis said the takeover marks a new and adventurous beginning for the company. The talented teams of both firms would engage in moving forward the vision of Hexo to form the best cannabis technology firm. He congratulated the entire team and especially Jay Wilgar for the trust they reposed in Hexo to grow together.

Formalizes a presence in the US

Hexo has appointed Chief Financial Officer to formalize the presence in the US. With the appointment of Michael Monahan as CFO and the creation of Hexo USA Inc, the company is on the path to offer consistent cannabis experience to the users in the US through the launch of easy to use, innovative and branded products.

Sebastien said he has been touring the US explaining the story of Hexo to the potential and present investors. The company has been sharing the vision and intends to operate in the legalized cannabis market in the US. The establishment of Hexo USA Inc and appointment of US-based CFO are the right steps in this direction.

Hexo is one of the biggest companies in Canada engaged in the production of cannabis under license. Its manufacturing facilities are located in Quebec and Ontario. The company also established a footprint in Greece for Eurozone production, processing, and distribution centre establishment.

To form Truss, the company established a partnership with Molson Colors Canada. Truss will be responsible for the production of cannabis-infused beverages to meet the demand for the legal market in Canada. Hexo is well positioned to enjoy a considerable market share following the passage of the US farm bill that allows extraction of cannabidiol from hemp.

CFO said Sebastien had done an excellent job along with the team to ensure long-term success for Hexo. Manohan is pleased to join as it expands overseas.

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Marijuana

HEXO (OTCMKTS:HYYWF) ‘s Stock Rises On Overwhelming Investors Support For Takeover Of Newstrike Brands Ltd (OTCMKTS:NWKRF)

The stock of HEXO (OTCMKTS:HYYWF) has been rising since May 16, 2019, because of overwhelming support from the investors to take over Newstrike Brands Ltd (OTCMKTS:NWKRF). The stock surged past $7.35 following the deal approval and now trades at $6.76.

The deal, which is agreed in March 2019, required 66% voting from the investors. But, the investors gave a thumping nod to the deal with 97.6% votes. As per the agreed terms, Hexo will acquire all the outstanding and issued shares of Newstrike.

Supreme Court nod

Hexo acquired Newstrike on receipt of Supreme Court nod. Following the takeover, Newstrike would become a subsidiary of Hexo. The shares of Newstrike would be delisted from TSX on May 28, 2019.

Co-founder and Chief Executive Officer of Hexo, Sebastein St-Louis said the company enters the next adventurous phase. The talented teams of both companies will speed up the dream of Hexo to form the best cannabis technology company. He expressed thanks to the entire team of Newstrike and Jay Wilgar for the faith reposed in Hexo.

Share arrangement

As per the terms of the deal, the former shareholders of Newstrike will get 0.06332 share of Hexo for each of their share held in their account before the deal. The shareholders of Newstrike need to submit the share certificates along with a transmittal letter to receive the shares of Hexo. The Newstrike options holders can exchange the options for the shares of Hexo under the same terms.

New appointment

Hexo has appointed Donald Courtney as COO. His previous stints include Chief Operating Officer at MedReLeaf. He also worked at Pesi Bottling Group and Mars Inc.

Q2 2019 results

Hexo has posted revenues of more than $16.2 million in Q2 2019, up by 144% in Q1 2019. It is an increase of 1,269% when compared to Q2 2018. The production of dried cannabis has increased to 4,938 kg (up 39% from Q1 2019). The sales of dried cannabis have surged by 142% quarter on a quarter to 2,689 kg.

The company has mobilized funds of more than $54.2 million through an IPO. It has appointed the Bank of Montreal and Canadian Bank of Commerce as the managers for IPO.

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