Canadian cannabis extraction company Ayurcann Holdings Corp. ( AYURF ) (FSE: 3ZQ0) and a special purpose acquisition company Arogo Capital Acquisition Corporation ( AOGO ) entered into a definitive business combination agreement. The combined company will be worth $210 million.

“Ayurcann is one of the most innovative companies we have encountered, particularly in cannabis extraction and product development," stated Suradech Taweesaengsakulthai, CEO and director of Arogo. "With their impressive achievements and forward-looking plans, this business combination is set to drive the business onto a new growth trajectory, enhancing its capabilities and expanding the market reach in meaningful ways."

Miami, Florida and Toronto, Canada-based cannabis company highlighted 100% year-over-year growth of gross revenue over the last three audited financial reporting years.

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"We are proud of our team for what we have achieved as a company," Igal Sudman, chief executive officer of Ayurcann ( AYURF ) stated. "The business combination with Arogo, is our next step in growing the company nationally while allowing us to also look for international opportunities."

Merger Highlights

Under the deal, Ayurcann ( AYURF ) will pay Arogo $19.6 million in cash. At the same time, it is expected that Ayrucann shareholders will benefit from "an implied pro forma enterprise value of approximately $210 million, at a price of $10.00 per share."

The transaction is expected to close in the second half of 2024, subject to the receipt of all regulators, court, shareholders and other approvals, and the satisfaction or waiver of all customary closing conditions.

Under the transaction, ARC Group Limited will receive finder's fees in the amount of 799,731 common shares of the company.

Currently there are 194.7 million Ayurcann ( AYURF ) shares. Upon the transaction, the company projects that 260 million shares will be issued and outstanding, which will be consolidated on a 10:1 ratio, resulting in around 26 million shares.

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