Crucial Innovations Corp. (OTC: CINV), Announces Completion of Reverse Merger with Eco Equity, Medical Cannabis operator in Zimbabwe, Africa

Rhea-AI Summary

Crucial Innovations Corp (OTC: CINV) has successfully completed a reverse merger, acquiring Eco Equity Zimbabwe, valued at $210 million. The acquisition includes extensive cannabis cultivation facilities in Zimbabwe, with plans for future expansion. Eco Equity expects to initiate production sales by Q3 2023 and aims to achieve cash flow positivity by 2024. CINV plans to raise $25 million through private placements and an additional $65 million via a REG A offering in early 2023, post-merger. This move positions CINV as a pioneering Africa-based cannabis producer listed on the U.S. markets.

Positive

• Completed reverse merger positions CINV for growth in the cannabis market.
• Acquisition valued at $210 million reflects strong market confidence.
• Eco Equity expects to produce 15,470 Kg of high-THC cannabis annually.
• Projected cash flow positive by 2024 enhances investor outlook.
• Upcoming private placement aims to raise $25 million for expansion.

Negative

• Merger completion subject to regulatory filings and audited financial statements.
• Market entry may face competition and operational challenges in Zimbabwe.

Las Vegas, Nevada, Oct. 26, 2022 (GLOBE NEWSWIRE) -- Crucial Innovations Corp (OTC: CINV), a Nevada Company today announced that has completed its previously announced reverse merger by acquiring certain Medical Cannabis Operations in Zimbabwe, Africa from shareholders including JPD Capital PCC a Guernsey Investment fund with multiple investments in the medical cannabis sector in Africa and the U.K.  

JPD Capital had agreed with CINV, to reverse its operations in Zimbabwe Africa, into CINV, these are operated via its subsidiary Eco Equity (Pty) Ltd, and the transaction has been completed with Eco Equity Pty Limited now a wholly owned subsidiary of CINV.  

The reverse merger values Eco Equity for $210,000,000 USD and completed as full consideration paid in full as all stock acquisition of Eco Equity Zimbabwe (Pty) Limited with all its Medical Cannabis cultivation assets, this is at the same value placed on the business by Baker Tilly International in the original appraisal of the Zimbabwe business.

About Eco Equity Zimbabwe (Pty) Limited

ECO's facilities in Zimbabwe will include a fully Licensed 16,500 sq. meter polytunnel greenhouse, a 450 sq. meter R&D facility for genetics research and an onsite pumphouse provides adequate power to service all operations; the company is also preparing to build a GACP/EU-GMP certified, state-of-the-art, fully computerized 20,800 sq. meter glass greenhouse. The cultivation site is 24,000 sq. meters, and a 14,000 sq. meter post-harvest facility houses extraction-equipment and packaging machines. ECO will operate at a forecast annual production rate of 15,470 Kg of high-THC cannabis flower and 1,591 Kg of distillate oil; Management expects to continue scaling the ECO operation to meet growing demand and ECO expects to announce its first production sales by 3rd Quarter of 2023 and project that it will be cash flow positive in 2024.

The completion of the reverse takeover of CINV by Eco Equity Zimbabwe means Eco Equity Pty Limited Zimbabwe is now a wholly owned subsidiary of the publicly traded company CINV.

“This is an important milestone in the evolution of Eco Equity and the increasingly global cannabis industry,” said JP Doran, JPD’s co-founder and chief executive. “We will be the first Africa only cannabis producer to be publicly traded on the USA Markets, for nearly three years we have been at the leading edge of the medical cannabis industry, putting ourselves in a potentially dominant position through our low-cost production model and focus on genetics of Cannabinoids for Medical Purposes. 

"The reverse merger gives us the opportunity to accelerate our growth trajectory and will enable us to cement our position as one of the most progressive Cannabis companies globally.

"We had an obligation to our investors, and I'm delighted we have executed on this transaction providing a successful liquidity event and giving our investor huge scope for further upside.

As part of the original merger Agreement CINV, has agreed to undertake private placement offering pursuant to regulation D 506 in the USA and to foreign investors under Regulation S, to raise $25,000,000 at $5.00 per share, the placement will be available only to accredited investors immediately after the completion of the reverse Merger. The company intends to follow this initial equity capital raise with a $65,000,000 REG A offering in first quarter of 2023, subject to all required regulatory filings.

The completion of the reverse merger is subject to certain conditions including CINV, filing its September 30 10 Q and being current in its SEC Filings and Eco Equity Zimbabwe (Pty) Limited delivering its Audited financial Statements for the 2021 year end.  

Safe Harbor Statement: This press release may contain certain forward-looking statements and information, as defined within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934; and is subject to the Safe Harbor created by those sections. This material contains statements about expected future events and/or financial results that are forward-looking in nature and as such are by definition subject to risks and uncertainties

Contact:
Jon Paul Doran, CEO
Email: jpdoran@eco-equity.com                                       

Source: Crucial Innovations Corp    
Authorized by Jon Paul Doran, CEO

For more information see www.eco-equity.com

FAQ

What is the significance of the reverse merger for CINV?

The reverse merger allows CINV to acquire Eco Equity Zimbabwe, positioning the company as a leading cannabis producer in Africa and enhancing its market presence in the U.S.

What is the valuation of Eco Equity in the merger?

Eco Equity is valued at $210 million following the completion of the reverse merger.

When does CINV expect to start cannabis production?

CINV expects its subsidiary, Eco Equity, to announce its first production sales by Q3 2023.

What are CINV's future financial plans post-merger?

CINV plans to raise $25 million through a private placement and an additional $65 million via a REG A offering in early 2023.

What are the potential challenges CINV may face after the merger?

CINV may encounter regulatory hurdles, competition, and operational challenges in establishing its cannabis operations in Zimbabwe.