SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 under
the Securities Exchange Act of 1934
For the month of: May 2019 | Commission File Number: 001-33526 |
NEPTUNE WELLNESS SOLUTIONS INC.
(Translation of Registrant’s name into English)
545 Promende
du Centropolis
Suite 100
Laval, Québec
Canada H7T 0A3
(Address of Principal Executive Office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ¨ Form 40-F x
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ¨ No x
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
NEPTUNE WELLNESS SOLUTIONS INC. | ||
Date: May 9, 2019 | By: | /s/ Mario Paradis |
Name: | Mario Paradis | |
Title: | VP & Chief Financial Officer |
EXHIBIT INDEX
Exhibit | Description of Exhibit |
99.1 | Press Release dated May 9, 2019 |
Exhibit 99.1
Neptune Signs definitive agreement to acquire the assets of Hemp processor SugarLeaf Labs
Establishes U.S. footprint with processing capacity of 1,500,000kg
LAVAL, QC, May 9, 2019 /CNW Telbec/ - Neptune Wellness Solutions Inc. ("Neptune" or the "Company") (NASDAQ: NEPT) (TSX: NEPT) today announced the signing of a definitive agreement to acquire substantially all of the assets of SugarLeaf Labs, LLC and Forest Remedies LLC (collectively, "SugarLeaf"), a registered North Carolina-based commercial hemp company providing extraction services and formulated products. Through SugarLeaf, Neptune establishes a U.S.-based hemp extract supply chain, gaining a 24,000 square foot facility located in the important U.S. Southeast region. SugarLeaf's cutting-edge cold ethanol processing facility with a processing capacity of 1,500,000 kg uses hemp cultivated by licensed American growers consistent with federal and state regulations to yield high-quality full and broad-spectrum hemp extracts. The U.S. market for hemp is developing rapidly and represents a significant opportunity for the consumer products industry.
Neptune will acquire SugarLeaf on a debt-free basis for initial consideration at closing of US$18 million, paid as US$12 million in cash and US$6 million in common shares. By achieving certain annual adjusted EBITDA and other performance targets, additional consideration of up to US$132 million would be paid over each of the next three years as a combination of cash and shares for a maximum aggregate purchase price of up to US$150 million. The Transaction is expected to close on or before July 31st, 2019, upon completion of standard closing requirements, including regulatory and stock exchange (NASDAQ and TSX) approvals.
"With Neptune's Canada-based operations ramping up production and the cannabis industry growing exponentially around the world due to an evolving legal global framework, now is the time to establish a state-of-the-art supply chain in the U.S. marketplace," said Jim Hamilton, President and CEO of Neptune. "SugarLeaf's capacity, efficient production of high-quality extracts, and strong supplier relationships, combined with our existing competencies in customer relationships and science-based formulations, creates a strong value proposition to U.S. brands who want to offer differentiated products to consumers. Neptune's objective is to be a world's leader in extraction, purification and formulation of value-added cannabis and natural health products. We warmly welcome the SugarLeaf team to Neptune."
"We are thrilled to be joining forces with Neptune" said Peter Galloway, CEO of SugarLeaf. "The SugarLeaf team looks forward to combining our strengths with that of the Neptune team, thereby accelerating our combined growth and development."
Additional Information on SugarLeaf
SugarLeaf's Conover, North Carolina extraction facility has a processing capacity of 1,500,000 kg. SugarLeaf also possesses established, solid relationships with local farmers and consumer product companies looking for high purity hemp extracts to add to their product lines. The existing management team at SugarLeaf consists of experienced operators who will continue to operate the North Carolina extraction facility.
Sugarleaf has highly efficient hemp extraction capabilities in an important cultivation region of the U.S., developed through years of experience in processing and extraction methods. The company has been at the center of an extensive community that supports hemp extract production and refining, and uses the most advanced extraction equipment available – from stainless centrifuges to high capacity filtering and purifying techniques.
Additionally, Sugarleaf sources hemp material from local licensed hemp growers who use responsible growing practices, including organic and regenerative farming techniques. SugarLeaf uses non-GMO ethanol at extremely cold temperatures with advanced lab techniques that produce cannabinoid-rich extracts.
Additional Transaction Details
Upon closing of the Transaction, Neptune will pay initial consideration of US$18 million, comprising US$12 million of cash and
US$6 million in Neptune shares. Neptune plans to finance all or part of the cash portion of the initial consideration through a
lending arrangement with a bank or other institution, or a private or public equity financing (or a combination of such financings).
An additional US$6 million in shares will be paid when certain production and revenue milestones are achieved. Neptune will also
pay an additional US$16 million, 50% in cash and the remainder in Neptune common shares, should SugarLeaf's adjusted EBITDA exceed
US$8 million for any rolling 12-month period beginning April 1, 2019. Performance-based considerations have also been structured
and will be based upon a percentage incremental adjusted EBITDA in 2021 and 2022 above a minimum growth level of up to a maximum
of US$110 million. Neptune has the option to pay these additional considerations with a combination of cash and shares.
The Transaction will be subject to normal post-closing adjustments and customary terms and conditions. The Transaction is expected to close on or before July 31st, 2019.
TD Securities Inc. is acting as financial advisor to Neptune and Osler, Hoskin & Harcourt LLP is acting as legal counsel to Neptune, and Vicente Sederberg LLP is acting as U.S. regulatory counsel to Neptune. Fluet, Huber & Hoang is acting as legal advisor to SugarLeaf.
For more information about Neptune's US products and services portfolio, please write to info@neptunecorp.com.
About Neptune Wellness Solutions Inc.
Neptune Wellness Solutions specializes in the extraction, purification and formulation of
health and wellness products. Licensed by Health Canada to process cannabis at its 50,000 square foot facility located in Sherbrooke,
Quebec, Neptune brings decades of experience in the natural products sector to the legal cannabis industry.
Leveraging its scientific and technological expertise, Neptune focuses on the development
of value-added and differentiated products for the Canadian and global cannabis markets. Neptune's activities also include the
development and commercialization of turnkey nutrition solutions and patented ingredients such as MaxSimil®,
and of a variety of marine and seed oils. Its head office is located in Laval, Quebec.
Forward Looking Statements
Statements in this press release that are not statements of historical or current fact constitute "forward-looking
statements" within the meaning of the U.S. securities laws and Canadian securities laws.
Such forward-looking statements involve known and unknown risks, uncertainties, and other unknown
factors that could cause the actual results of Neptune to be materially different from historical results or from any future results expressed or
implied by such forward-looking statements. In addition to statements which explicitly describe such risks and
uncertainties, readers are urged to consider statements labeled with the terms "believes", "belief", "expects",
"intends", "projects", "anticipates", "will", "should" or "plans" to be
uncertain and forward-looking. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date
of this press release. Forward-looking information in this press release includes, but is not limited to, information
or statements about Neptune's ability to successfully develop, produce, supply, promote or generate any revenue
from the sale of any hemp-based products in the legal hemp market; the evolution of the U.S. regulatory
framework at both the state and the federal level; the timing of Neptune's or its partners' anticipated
results, including in connection with the likelihood and timing of obtaining any necessary
governmental approvals; and the ability or failure of Neptune or its partners to comply
with governmental regulations.
The forward-looking statements contained in this press release are expressly qualified in their entirety by this cautionary statement and the "Cautionary Note Regarding Forward-Looking Information" section contained in Neptune's latest Annual Information Form (the "AIF"), which also forms part of Neptune's latest annual report on Form 40-F, and which is available on SEDAR at www.sedar.com, on EDGAR at www.sec.gov/edgar.shtml and on the investor section of Neptune's website at www.neptunecorp.com. All forward-looking statements in this press release are made as of the date of this press release. Neptune does not undertake to update any such forward-looking statements whether as a result of new information, future events or otherwise, except as required by law. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in Neptune public securities filings with the Securities and Exchange Commission and the Canadian securities commissions. Additional information about these assumptions and risks and uncertainties is contained in the AIF under "Risk Factors".
Neither NASDAQ nor the Toronto Stock Exchange accepts responsibility for the adequacy or accuracy of this release.
Logo: SugarLeaf Labs (CNW Group/Neptune Wellness Solutions Inc.)
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SOURCE Neptune Wellness Solutions Inc.
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%CIK: 0001401395
For further information: Investor Information: Canada, Pierre Boucher, MaisonBrison, 1.514.731.0000, pierre@maisonbrison.com; United States, Carolyn Capaccio / Jody Burfening, LHA, 1.212.838.3777, ccapaccio@lhai.com / jburfening@lhai.com; Media Requests: Sabrina Di Blasio, Neptune Wellness Solutions, 514.258.8183, s.diblasio@neptunecorp.com
CO: Neptune Wellness Solutions Inc.
CNW 08:00e 09-MAY-19
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