CA - MediPharm to cut ~30% staff amid restructuring

2023-04-13 08:36:03 ET

MediPharm Labs ( OTCQX:MEDIF ) said it has started restructuring following completion of its acquisition of VIVO Cannabis which became effective April 1.

MediPharm noted it has executed initial steps to achieve positive EBITDA synergies between $7M and $9M on an annualized basis.

The company has implemented plans to reduce the combined MediPharm and VIVO non-direct labor workforce by ~30%, since the announcement of the transaction.

The company expects all headcount related savings will be fully implemented within four to six months. This is in addition to previously announced restructuring efforts made separately by both companies in 2022.

Due to these initiatives, total non-direct labor headcount between both companies will have been reduced by ~45% as compared to January 2022.

The company added that senior executive level positions have now been reduced by 50%, compared to January 2022.

The senior level changes represent the largest portion of employee related cost savings, according to the company.

MediPharm noted that the workforce reductions are paired with cost synergies related to combining some company functions and reducing certain public company costs previously incurred by the two companies.

In addition, VIVO's CFO was appointed to MediPharm's board effective April 1.

In December 2022, MediPharm announced the acquisition of VIVO in an all-stock deal.

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