Indiva Opens Gateway to European Cannabis Market with Agreement to Acquire License in Denmark

Ontario Licensed Producer Indiva Limited finds itself back in the news after an announcement was made on Wednesday, November 21st that the company has signed a non-binding letter of intent with Denmark based AEssense Europe.  The agreement includes the 100% acquisition of a medical cannabis cultivation and handling license under the Danish Medicines Agency development program.  Indiva will fund the recent acquisition using US$1.1 million in cash together with 1.6 million Indiva common shares, payable over a three-year period.  AEssense Europe received its license from the Danish Medicines Agency early in 2018.  

This license acquisition signals Indiva’s continued intent to take its cannabis products worldwide, beginning with Europe.  More specifically, Indiva aims to cultivate and distribute medicinal cannabis and cannabis derived products that are EU-GMP certified worldwide.  This will be achieved through the incorporation of a wholly-owned subsidiary that will take responsibility of all management and financial tasks for European operations.  Creating a base for European operations has been one of Indiva’s goals this past year and it now looks like the plan will come to fruition.

There are also plans which involve Indiva Europe and the use of the AEtrium fully-automated aeroponic grow platform proprietary to AEssense, in construction of an indoor grow facility in Denmark.  This will allow Indiva to consistently produce premium quality, ultra-clean pharmaceutical grade cannabis that complies with EU-GMP and GACP standards.  The two companies have already begun to identify sites where Indiva Europe facilities will be situated and constructed. These facilities are to include a planned 1,000 sqft research lab and allot for the expansion space necessary for Indiva Europe to meet demand for premium quality cannabis from Danish medical cannabis patients and the European cannabis market.

As per the recent agreement, Indiva will hold exclusive rights to all production that is cannabis related.  The Denmark license will be leveraged to import EU-GMP marijuana to Denmark and the rest of Europe.  There are currently seventeen European nations that have legalized medical cannabis including Germany, Holland, Italy, Greece, Poland, UK, Portugal, Romania, Croatia, Norway, Switzerland, Cyprus, Finland, Malta, Macedonia and Luxemburg.  Recreational cannabis still remains outlawed but even in the EU, cannabis laws are beginning to soften.

Currently, the closing of the transaction is subject to certain customary conditions, which include execution of a definitive agreement between both parties, applicable regulatory approvals and completion of satisfactory due diligence.   A definitive agreement between Indiva and AEssense is expected by the end of 2018.

Indiva has been aggressively pursuing factors of competitive advantage, and the emerging European cannabis market, potentially worth an estimated $80-100 billion, has been a goal for some time.  In Europe, medical cannabis is growing in popularity, and with acceptance levels rising, so is the number of registered patients. With over 500 million people living in Europe, this emerging market could become a pillar of the company’s business model.

Niel Marotta, CEO of Indiva explained, “We are very excited about entering the European market.  This acquisition of a Danish license and collaboration with AEssense provides a gateway to the EU and the tremendous growth expected in the European cannabis market. Indiva is now positioned to produce and distribute cannabis and cannabis derived products under some of the most stringent quality rules in the world.  We look forward to further strategic partnerships to continue to develop this entry into a growing global market.”

Bob Chen, CEO of AEssense was also optimistic, “We are looking forward to expanding our working relationship with Indiva from Canada to Denmark.  Our new Danish research laboratory will allow AEssense to continue to progress the cutting-edge technologies that make our automated aeroponic cultivation platform unique and deliver superior quality and higher yields for our customers. We believe the AEtrium platform will be the new standard for producing a premium, repeatable output for the Danish market and beyond.  Our collaboration with Indiva including access to a research location on-site will enable both companies to learn and grow, providing an optimal structure for information sharing and constant improvement.”

Michael Joergensen from AEssense said, “We are confident that Indiva with AEssense’s support and the AEtrium platform will provide patients in Denmark and the rest of Europe with the highest quality cannabis, meeting the most stringent standards.  The AEtrium platform will produce ultra-clean pharma grade products while reducing produced waste with up to 90% versus traditional cultivation methods. But most of all I am looking forward to Indiva making a real difference for patients”.

For Indiva, this license acquisition agreement is the next step on-route to securing the company’s stake in the emerging European cannabis market, while acquiring the state-of-the-art accelerated growth SmartFarm aeroponics platform and automation software.  

All of this plays perfectly with Indiva’s game plan.  The company isn’t about massive acreages for cultivation, instead the focus remains on providing the highest quality product that customers will love to enjoy.  Indiva also prides itself on being environmentally sustainable in their operations and strives to have a positive impact on communities and peoples lives.  Maintaining product quality and customer service will give Indiva the option of future expansion alongside the growing Canadian and international cannabis markets.  The company aims to become a global cannabis brand but it’s base of operations platform will remain in Canada.  Indiva is also waiting for safe cannabis edibles and other cannabis derivatives to become legalized so the company can roll out their cannabis infused product lines including Ruby Cannabis Sugar, Sapphire Salt and Bhang Chocolate.  

Even though Indiva is a smaller Licensed Producers in Canada, the company has large plans and is positioning itself for global success.

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