Green Organic Dutchman Buy Should Be a Key Growth Driver

The Green Organic Dutchman Holdings Ltd is set to acquire HemPoland, which has local distributors in several European countries

The Green Organic Dutchman Holdings Ltd. announced recently that it has signed an agreement to acquire 100% of privately-held HemPoland in an accretive cash and share transaction. The acquisition comes at a cost of US$7.75 million in cash and 1,968,323 restricted Green Organic Dutchman shares currently worth US$7.75 million with an additional US$10.3 million cash investment for European expansion. There are also additional performance-based incentives of up to US$12 million for delivery of US$32 million of EBITDA in fiscal 2021. HemPoland is the first private company in Poland to obtain a state license allowing it to grow and manufacture Cannabis Sativa. It produces and markets cannabis and organic CBD oils. HemPoland was founded in 2014 and is headquartered in Elblag, Poland.

Green Organic Dutchman would get access to HemPoland’s vast distribution network, premium Cannabigold brand, state-of-the-art hemp oil extraction technologies, and a pathway into the European market for TGOD’s medical & recreational products and licensing deals. HemPoland is a vertically-integrated enterprise, with over 1,250 acres of cultivation leveraging third parties, multiple commercial scale extraction units, local distributors in Poland, Austria, Netherlands, Germany, United Kingdom, Italy, Switzerland, Portugal, Ireland, Czech Republic, Slovenia, Lithuania, and Estonia, and product sales in over 700 locations. In 2017, the company produced over 32,000 kg of organic dried flower and 310 kg of organic CBD oils.

Green Organic Dutchman CEO Brian Athaide said, “HemPoland is a key component to a number of strategic acquisitions and planned partnerships focused on expanding our global distribution network. This acquisition will significantly add to the Company’s top and bottom line. Gaining market share with CBD products now, in the EU, with over 700 locations allows TGOD to establish immediate brand awareness across all verticals including infused beverages. This is an accretive acquisition and gateway to Europe’s 750 million people accelerating our plan of becoming the world’s largest organic cannabis brand.”

HemPoland Founder and CEO Maciej Kowalski added, “We are pleased to join forces with the premier brand in organic cannabis, TGOD, to scale the growth of our business both domestically and internationally. The market and demand for premium organic cannabis and CBD oil is just the beginning, ultimately leading to a variety of higher margin products. Having access to TGOD’s capital, licensing deals, experienced leadership team, and intellectual property will significantly drive momentum for our brand and our company. We are proud to be part of the TGOD family and look forward to becoming the global leaders in organic cannabis.”

The Green Organic Dutchman Holdings trades at market capitalization of C$1.41 billion with price to book multiple of 4.30x.


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