Brigadier Provides Update on Change of Business and Rapidly Developing China CBD Market
Vancouver, British Columbia--(Newsfile Corp. - January 14, 2020) - Brigadier Gold Limited (TSXV: BRG.H) (the "Corporation") is pleased to provide an update with respect to its previously announced change of business transaction (the "Proposed COB"), which, as announced in November, has been conditionally approved by the Canadian Securities Exchange (the "CSE").
The Corporation's initial portfolio will comprise an investment of up to 75% equity ownership (on a post-converted, fully diluted basis) in CBD Group Asia Limited ("CGA") and strategic investment/partnership with Natural Source Group Pte Limited ("NSG"). Following completion of the Proposed COB, the Corporation will commence trading on the CSE under the name Canrim Growth Group Inc. and under the symbol "CBDA" as an investment holding company (the "Resulting Issuer").
On January 8, 2020, CGA and the Corporation signed a non-binding memorandum of understanding with Chinese CBD production industry leader HH Biotechnology Holdings Co. ("HH Biotech"), to form the foundation of a cross investment and commercial partnership among CGA, the Resulting Issuer and HH Biotech. The parties will work toward signing a definitive agreement, with the intention of together building a CBD cultivation, production and extraction industry leader in China as well as surrounding Asia.
"We see the Asian markets in the health and wellness space, and in particular as it relates to the fledgling CBD product market, as having extremely high-growth potential and we are excited to provide our shareholders with exposure to unique investments in this area. We intend to leverage our holdings in CGA as well our recently signed MOU with HH Biotech into a growth oriented issuer" commented Ranjeet Sundher, CEO of the Corporation.
In conjunction with its other business efforts, CGA continues to roll out its proprietary sales platform, "iBloom". The iBloom mobile application is a cross-border WeChat sales tool targeting primarily Chinese consumers. The iBloom app has been through rounds of focus groups and marketing testing studies aimed at maximising its appeal to millennial, cash rich Asian consumers. CGA has carried out these tests successfully, and combined with CGA's software development team's efforts, expects to launch commercially within the first quarter of 2020. iBloom will warehouse both in Hong Kong as well through the "Free Trade Zones" in China in order to fulfil orders to both Chinese based consumers as well as those based Pan-Asia.
CGA has received offers from numerous North America brands to list on iBloom. In addition, it has received offers from Chinese wholesalers to purchase CBD products through the platform and CBD product manufacturers seeking Pan-Asia exposure through export markets. CGA expects to begin marketing iBloom in March 2020 and intends to be the first and the leading CBD focused sales tool in Asia.
CGA's CEO James Foster will be the keynote speaker in Hong Kong at the Asia Hemp Investment Summit & CBD Products Exhibition during the week of January 13, 2020. Asian industry leaders will convene as well as Chinese government officials to discuss and collaborate. In addition, he will be meeting with China's Yunnan provincial government heads to discuss investment opportunities as well as potential export production scenarios.
CGA has rebranded itself as CGA Innovate which better articulates CGA's business model. Please visit CGA's new website for more information: https://cgainnovate.com/
China Cannabidiol ("CBD") Landscape
CGA's initial operations will focus on the distribution of hemp CBD goods in China. China is currently the largest cultivator, producer, extractor and exporter of CBD in the world and legislation continues to change and trend toward market access and openness. China regulates CBD production and processing on a provincial basis, similarly to the United States (on a state basis). Each provincial government offers differing levels of efficiency in terms of regulation. Currently two provinces in China have legalized CBD production: Yunnan and HeiLongJiang. Yunnan has been cultivating cannabis for thousands of years, and as a result its government is proactive in facilitating the development of the CBD industry. HeiLongJiang became a hemp CBD producer more recently. Government subsidies are available to producers and other companies in the hemp CBD industry. Soon a third province, Jilin, will offer full legalisation.
James Foster, CGA's CEO commented: "we expect pharmaceutical and food legalisation for CBD derived from hemp in 2020. This will likely follow the United Nations International Commission on Narcotic Drugs removing low-THC, hemp extractions from the UN 1961 Single Convention on Narcotic Drugs, which China along with most countries currently follows. This will be a game changer for the industry and will create a wealth of CBD opportunities for CGA, Canrim and others in China, and likely elsewhere in Asia too."
The Corporation has changed the terms of the previously announced offering (the "Offering") which will be completed in connection with the Proposed COB. The Corporation will now complete the Offering of units ("Units") for a price of $0.20 per Unit, for aggregate gross proceeds of a minimum of CAD$2,000,000, with each Unit comprising one (1) common share of the Corporation and one-half (1/2) of one common share purchase warrant. Each whole purchase warrant will be exercisable for one common share of the Resulting Issuer (as defined below) for a price of $0.30 per common share for a period of one year.
Final acceptance of the Proposed COB will be subject to receipt of shareholder approval and completion of certain other conditions, including delivery of completed application documentation and closing of the Offering. The Corporation intends to hold a special shareholder meeting to approve the Proposed COB and related matters on February 27, 2020.
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Completion of the Proposed COB is subject to a number of conditions including, but not limited to, CSE final acceptance and approval of the TSXV of the delisting of the Common Shares. There can be no assurance that the Proposed COB will be completed as proposed or at all. Investors are cautioned that, except as disclosed in the disclosure document to be prepared in connection with the Proposed COB, any information released or received with respect to the Proposed COB may not be accurate or complete and should not be relied upon.
The TSXV has in no way passed upon the merits of the Proposed COB and has neither approved nor disapproved the content of this press release.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction.
ANY SECURITIES REFERRED TO HEREIN WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE "1933 ACT") AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO A U.S. PERSON IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT.
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Information Cautionary Statements
Statements in this press release regarding the Corporation's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties, including that the Proposed COB will be completed on the terms and within the timelines described herein or otherwise, receipt of required shareholder approvals, completion of the Corporation's private placement of Units, the development of the products and business of CGA, including iBloom, entering into a definitive agreement and completing a transaction with HH Biotech as well as management's expectations with respect to the timing of the foregoing, regulatory changes to the CBD market in Asia, and the benefits to the Corporation or Resulting Issuer which may be implied from such statements. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.
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