(TheNewswire)
Vancouver, British Columbia – TheNewswire - April 6, 2022 – Blackhawk GrowthCorp . (CSE:BLR ) ; ( Frankfurt:0JJ) (the “ Company ” or “ Blackhawk ”) ispleased to announce that the Company has entered into a share purchaseagreement, dated effective April 5, 2022, pursuant to which itproposes to acquire all of the outstanding share capital of BlumDistributors Ltd. (“ Blum ”).
Blum is an established mycologysupplier with its own leased production facilit y .Blum’s operations are systemically rooted in biodiversity. Theywholly-own the value chain from cultivation through to their productsales, reaching both commercial and retail partners. Theirsustainability pledge is embodied in their commitment to support theirpartners in their own mycological journeys. Blum’s in-house productcultivation, distribution, and sales center provides them with anadvantage over their competitors by reducing intermediaries. Blumfully controls the quality and purity of their products throughout thevalue chain, from cultivation to consumer sales. They are committed toproviding the utmost highest quality supplies and solutions to empowerboth commercial and home scale growers in their mycological journey.
Blum has been in operations in its current form forover 18 months and has historically generated approximately $50,000 in gross revenueper month over 2021. The revenue base has grown in 2022, with the addition of two agreements. The first contract hasBlum providing a white label solution for anarm's length company for Applied Myco. The contract guarantees for a minimum order of 500 bagsper month during its Phase 1 trial and isexpected to increase to up to 2,000 bags permonth in Phase 2 and 3 over the next 12 months. The guaranteed minimumorder will generate approximately $12,500 per month in gross revenue,and is expected to increase to in excess of $50,000 per month inrevenue. Gross margin on the products historically has beenapproximately 50% and this margin is expected to continue.
The next recent sale, which is expected to start delivery in April,will see Blum expand its cultivation through a 14,000 sq ft commercialproject which is guaranteed to begin with an order for 5,000 bags permonth, which is expected to create gross revenue of approximately$125,000 per month. W hen the cultivation centre renovations are completed, thecontract has production increases of 5,000 per cycle to a maximum sizeof 50,000 bags per month. If the maximum contract deliveries arereached, the order will generate in excess of $1,000,000 per month ingross revenue for Blum, based on current sales prices.
“Blum’s growth continues tobe impressive” said Frederick Pels, CEO of Blackhawk Growth. “Theancillary side of cultivation allows Blackhawk to be involved in thesuccess of the industry as a whole, providing high quality andnecessary substrate to the industry. I look forward to working withthe team at Blum and updating our shareholders as progressdevelops.”
“We at Blum Distributors are extremely excited toclose this deal and grow both Blum and Blackhawk” says Rico Gutierrez, Founder of Blum.“This opportunity will allow us to further accelerate our on-goingdemand of production and supplies and will assist us to expand ourfacility and operate at full capacity to facilitate the fast-growingmycology industry.”
Rico Gutierrez founded Blum and will continue as itsCEO. Mr Gutierrez has been involved in the mycology industry for a number ofyears. Prior to founding Blum, he was a successful entrepreneurand the founder of several companies in various industries. With his experience and skill set, Rico managedto assist numerous companies with mentorship and business development.
Readers are cautioned that the above figures forrevenue and margin of Blum are based on information provided bymanagement of Blum and have not been audited or independentlyverified. Actual figures may differ once an audit has takenplace.
Transaction Structure
In consideration for the acquisition of all of theoutstanding share capital of Blum, Blackhawk will issue 9,650,000common shares to the existing shareholders of Blum.
The Company is at arm's length from Blum and itsshareholders. The transaction neither constitutes a fundamental changenor a change of business for the company, nor has it expected toresult in a change of control of the company within the meaning ofapplicable securities laws and the policies of the Canadian SecuritiesExchange. With the acquisition, Blum will form part of the Company'sgrowing portfolio of investments in the life science and health caresectors. Blum’s existing management team will continue to retainresponsibility for overseeing day-to-day operations. A fee of 750,000shares will be paid to an arm’s length party for assistance with thetransaction.
For more information regarding Blum visit theirwebsite: www.blumdistributors.com
About Blackhawk Growth
Blackhawk is an investment holding company looking tocreate substantial value for its shareholders through the acquisitionand development of high growth companies. It has focused itsinvestments in the health, cannabis and cannabidiol industries in bothCanada and the United States. Its portfolio of companies includes SacPharma, Terp Wholesale, LeichtMind Clinics, Noble Hemp, Spaced Food,Stable Foods, and MindBio Therapeutics, Digital Mind Therapeutics aswell as an equity position in Gaia Grow Corp. (CSE:GAIA).
The Company diligently posts updates through videosfrom the official company YouTube channel https://www.youtube.com/channel/UCs4f2tt3yAvOGhNLjgNOy-A
Please join the conversation on our Blackhawk groupsupporter’s telegram group at https://t.me/Blackhawkgrowthcorp and visit us online at https://www.blackhawkgrowth.com .
For further information please contact:
Frederick Pels, Chief ExecutiveOfficer
(403)-991-7737
fred@ blackhawkgrowth.com
Cautionary NoteRegarding Forward-Looking Statement
All statements in this pressrelease, other than statements of historical fact, are “forward-looking information”with respect to the Company within the meaning of applicablesecurities laws, including with respect to the future operations of Blum Distributors Ltd.. TheCompany provides forward-looking statements for the purpose ofconveying information about current expectations and plans relating tothe future and readers are cautioned that such statements may not beappropriate for other purposes. By its nature, this information issubject to inherent risks and uncertainties that may be general orspecific and which give rise to the possibility that expectations,forecasts, predictions, projections or conclusions will not prove tobe accurate, that assumptions may not be correct and that objectives,strategic goals and priorities will not be achieved. These risks anduncertainties include but are not limited those identified andreported in the Company’s public filings under the Company’s SEDARprofile at www.sedar.com. Although the Company has attempted toidentify important factors that could cause actual actions, events orresults to differ materially from those described in forward-lookinginformation, there may be other factors that cause actions, events orresults not to be as anticipated, estimated or intended. There can beno assurance that such information will prove to be accurate as actualresults and future events could differ materially from thoseanticipated in such statements. The Company disclaims any intention orobligation to update or revise any forward-looking information,whether as a result of new information, future events or otherwiseunless required by law.
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