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by Stockwatch Business Reporter
The TSX Venture Exchange lost 1.28 points to 802.39 Wednesday. Scott Kelly's halted NEX shell, Newstrike Resources Ltd. (NR), plans to acquire HPI Holdings Ltd., a licensed marijuana grower with a facility in Brantford, Ont.
The shell, which has 56,574,581 shares issued, will issue 269 million shares to its target's shareholders.
HPI was founded in March, 2013. It received its marijuana cultivation licence in December, 2016. The company is still waiting for its sales licence, but it is already planning to build a second facility in Creemore, two hours north of Brantford. HPI expects to spend $3-million on the new facility and to build it between August, 2017, and January, 2018. To partly finance its expansion plan, HPI has sold a $1.5-million private placement of convertible debentures. The subscribers to this financing will receive 11,996,059 shares of the resulting issuer on closing. To help HPI with its expansion plan, the shell has also sold a $3.12-million private placement of 25 million subscription receipts at 12.5 cents.
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