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Little Green Pharma Ltd (ASX:LGP) has today entered a binding letter of intent (LOI) to acquire HH Pty Ltd, an Australia-focused medicinal cannabis distribution business, from a company with which it has been partnered since 2019.
The acquisition – to be made for a purchase price of $1.25 million – reflects LGP’s business strategy of building a portfolio of sustainable medicinal cannabis companies, with this one particularly attractive given an annual revenue of around $7.5 million.
LGP has been offered an exclusivity period until January 31, 2025, to complete due diligence and finalise the terms for acquiring 100% of the issued shares in Health House on a fully diluted basis.
It will pay the seller – Health House Australia – a non-refundable deposit of $50,000 plus a refundable deposit of $25,000, with to be applied to the final acquisition price.
Vertical integration is the key concept with this transaction, with LGP believing it will boost its operational flexibility, and further strengthen its leadership position in the Australian medicinal cannabis sector.
At 13:36 AEDT, LGP shares were trading at 13 cents – a rise of 4% since market open.
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