Beleave, Inc. (BE.CNX) announced a strategic partnership recently aimed to enable the company to substantially increase its potential production capacity, thereby creating value without diluting shareholders. The company said it has entered into an interim streaming agreement with PanCann Streaming Corp. to finance the purchase and construction of a proposed second production facility in exchange for equity participation in, and a production yield allocation from the proposed facility.
“This opportunity allows Beleave to add supply beyond its current expansion plans, as well as explore wholesale opportunities that will not interfere with our potential patient sales in the future. This will increase our top line while eliminating the need for capital expenditure,” Roger Ferreira, CEO and Director of Beleave, stated in the announcement. “A completely accretive agreement for Beleave Inc., and the start of a new and exciting partnership with PanCann.”
The facility has yet to be identified but is expected to be located in Ontario, Canada. Both companies are collaborating in the process to determine an appropriate second site, which will be acquired and developed by a newly formed special purpose subsidiary of Beleave. The company said proposed second site will be designed to accommodate 200,000 square feet of cultivation space. PanCann will provide up to $5 million to fund the purchase of the second site and all necessary funding to complete the construction of the new facility. In return, PanCann will receive a 50% equity interest in the newly created subsidiary, as well as 50% of the proceeds of future wholesale or retail sales completed by the subsidiary.
Beleave’s Bigger Picture
In March, Beleave announced that Health Canada had scheduled a pre-license inspection of Beleave’s facility. Should Beleave pass this rigorous inspection, the ACMPR program will have issued licenses to 40 producers across Canada. The company has said that, “while there is no guarantee that a license under the ACMPR will be granted, management and its advisors believe that the Facility should meet regulatory requirements.”
In the meantime, Beleave continues to actively conduct research collaborations with Ryerson University in both extract and genetic research. The company has also built out its 14,500 square-foot facility in Flambrough, Ontario. With its present production space, the company has said it can produce 550,000 grams of product annually once licensed. Beleave’s future agenda includes adding another 70,000 square feet of production space at the property.
The facility’s floors and walls have been covered with anti-microbial, abrasion proof, anti-moisture, non-toxic, microbiocidal, non-leaching, flame-retardant and non-slip material to ensure a safe work environment and a healthy product free of contaminants. Equipped with tempered glass, and concrete barriers, it is monitored 24 hours a day with the latest infrared facial recognition camera systems.
To further ensure safety, the site is encased in fencing with barbed wire and covered with seismic, vibration and motion sensors. Sensitive areas are also protected with video interphones and panic buttons. The company’s leadership team worked together to build a facility prepared for integrated and high-level production.
Beleave intends to grow, market and distribute our product with the objective of pushing the industry to new heights, and becoming a licensed producer would be a major milestone toward achieving that goal.
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