DENVER and TORONTO – MJardin Group, Inc. (“MJardin” or “the Company”) (CSE: MJAR) (OTCQX: MJARF), a leader in premium cannabis production, today announced it has finalized the design for its Warman Road project in Winnipeg, Manitoba (“Warman”), a hybrid facility encompassing indoor and greenhouse production along with full EU GMP certified extraction, processing and packaging capabilities. The Company also announced the signing of a non-binding Letter of Intent (“LOI”) with Peguis First Nation (“Peguis”) for a Joint Venture (“JV”) in connection with the operation and ownership of Warman.
Key details of the proposed JV are as follows:
Peguis to purchase existing land and buildings from MJardin for C$11 million and execute a concurrent long term lease back to the JV;
Peguis to additionally fund the Capital Expenditures required to complete Phase 2 of the facility for approximately C$20.5 million;
MJardin and Peguis to own 49.0% and 51.0% of the JV, respectively;
MJardin will hold or nominate a majority of seats on the JV Board of Directors and will manage the new Facility under a long term, renewable Managed Services Agreement (“MSA”);
Phase 2 of the build-out will see the facility achieve Q2 2020 production capacity of approximately 4,500 kg of high-quality dried flower and 800 litres of bulk oil for use in refined products;
The site has the infrastructure to support further expansions in the future.
“We are very pleased to announce this transaction and are looking forward to growing our existing retail partnership with Peguis First Nation in a material way. Our enhanced Warman plan is highly scalable and will provide Canadian and International markets with the high quality flower that MJardin is known for, as well as a new range of consumer products leveraging our recent Canabella acquisition,” said Patrick Witcher, COO of MJardin. “This approach of delivering a diversified product mix provides MJardin with a more robust and resilient revenue model in the short run and superior positioning for addressing future market trends, locally and internationally. Our new design provides this at a lower capital cost, while optimizing EBITDA margins and return on invested capital.”
“This is an exciting step and represents a corner stone in Peguis’ goal of establishing material revenue and employment opportunities within this industry,” said Glenn Hudson, Chief of Peguis First Nation. “We have been consistently impressed with the capability and expertise demonstrated by the MJardin teams across the entire organization and the passion they bring to this business matches the passion with which we are pursuing a better future for our People.”
About MJardin Group
MJardin is a cannabis management platform with extensive experience in cultivation, processing, distribution and retail. For over 10 years, MJardin has refined cultivation methodologies, developed state of the art facilities and implemented vertical integration for and on behalf of license owners. MJardin is based in Denver, Colorado and Toronto, Canada. For more information, please visit www.mjardin.com.