Red Light Holland (TRIP.C) and Australian-based cannabis company, Creso Pharma Limited (CPH.ASX) cancelled their previously announced merger today, according to a press release.
The merger was originally announced in June 2021, but this merger has effectively become a casualty of the COVID-19 pandemic, as travel restrictions and other impacts have made both companies reconsider whether or not this combination would be in the best interests of their respective shareholders. As it turns out, they agreed it wouldn’t be.
“While we determined that a merger was no longer in the best interests of the two companies, we look forward to continuing to work closely with Adam Blumenthal and the rest of the Creso Pharma team as Red Light Holland has agreed to white-label Creso Pharma’s products and distribute them across our SR-Wholesale sales channels. We are also continuing our search for other M&A opportunities as we are confident that our large cash balance puts us in a position of strength as potential progressive regulatory changes in the North American psychedelic and recreational cannabis sectors open up,” said Todd Shapiro, CEO and director of Red Light Holland.
Ontario-based Red Light Holland is a psychedelics company involved in the production, growth and sale of magic truffles to the legal market in the Netherlands, using their existing Smart Shops operators and an e-commerce platform. Creso Pharma is a multinational cannabis company with operations in such disparate locales as Canada, Colombia and Switzerland.
Sometimes these things happen. Travel restrictions and the impending Delta variant and the complications it’s bound to bring in the coming months would make integration particularly difficult while limiting the benefits of the merger. They’re doing so on good terms, though, with Bruce Linton, former CEO of Canopy Growth (WEED.T) staying with Red Light Holland as their advisory board chairman.
“We respect Todd Shapiro and the entire team at Red Light Holland. Unfortunately, the geographic span of our respective businesses made a merger at this time impractical. We look forward to working with the Red Light Holland team through our new supply arrangement,” said Adam Blumenthal, Creso Pharma’s non-executive chairman.