SUNRISE, Fla., May 08, 2019 (GLOBE NEWSWIRE) — Profile Solutions, Inc. (OTC Pink: PSIQ) is pleased to announce the proposed acquisition of 80% of the Capital Stock and Assets of Ecoland K.K.L. LTD, an Israel LTD. and Ecoland Group USA SF, INC., a CA Corp.’s Cannabis licenses, operations and real estate in Northern California (“Ecoland”) for approximately $18,300,000 worth of PSIQ shares of common stock (approximately 82 mil shares based upon the closing price of .222784 per share on May 7th 2019).
Included in the proposed acquisition are all or part of (1) Indoor Cultivation License (2) Outdoor Cultivation Licenses (3) Manufacturing License (4) Distribution License (5) Retail Delivery License and (6) Retail Cannabis License as well as real estate, leases and IP rights. The preceding licenses have either been secured by Ecoland or in the process of being secured. Ecoland shall provide proof of $6,000,000 cash invested in its operations prior to closing of the proposed acquisition. Ecoland’s website can be viewed at www.ecoland-group.com.
PSIQ is to invest $5,000,000 as follows; $2,500,000 at closing and $2,500,000 within 6 months of closing. The proposed agreement is nonbinding, subject to due-diligence, financing and execution of definitive and related agreements with an intended closing on or before 30 days unless mutually extended in writing by the parties.
CALIFORNIA CANNABIS MARKET
In 2017, California’s regulatory regime allowed only holding state-issued medical cannabis cards to legally purchase cannabis. But that hasn’t stopped sales in the state from eclipsing the other states with recreational sales. In fact, sales in California represented about 34 percent of legal sales in the United States. In 2018, California retail stores sold $2.5 billion worth of cannabis products, compared to $1.5 billion in Colorado’s robust cannabis marketplace, $1.0 billion in Washington, and $0.6 billion in Oregon.
CALIFORNIA CANNABIS MARKET PROJECTIONS
By 2022, cannabis market in California is projected to jump to $7.7 billion – boosted significantly by California’s recreational cannabis market that opened for business in 2018. The California cannabis industry’s total economic impact could be nearly $15 billion in the next four years. According to the UCAIC, about 29 percent of cannabis consumers may, at first, stay in the illicit market to avoid the costs of new regulations, which will add 15 percent to retail values. After the state adopts regulations, legal recreational use will make up 61.5 percent of the overall market, illegally purchased marijuana will make up about 29.5 percent of the market and legal medical marijuana use will be about 9 percent of the overall market, the analysis estimated. Sales from recreational use are projected to account for over half of total Concentrate sales in California and continue to increase in proportion to overall category sales. Medical cannabis sales are expected to decline down to $600 million as people migrate toward the adult-use market to avoid medical cannabis ID fees.
“We are very excited to partner with Dan Oran and PSIQ. We have made great strides in developing and establishing our Brand in Norther California. With the cash infusion and management assistance to be provided by PSIQ, we anticipate generating revenues of $10,000,000 for year ending 2020,” stated Amir Weil, CEO of Ecoland.
Dan Oran, CEO of PSIQ, stated, “The proposed acquisition of Ecoland gives PSIQ its footprint into the largest Cannabis market in the United States. Combining the experience of the Ecoland management team, strategic locations and the expertise of sister company CannBerry Tek, providing unique man-made seeds known as Cannabis Genetic Seeds for growing, we believe Ecoland will have a tremendous competitive advantage therefore generating significant revenues and profitability for PSIQ and its shareholders.”