Aphria Inc. has proposed the acquisition of CC Pharma GmbH, a leading distributor of pharmaceutical products to more than 13,000 pharmacies in Germany. The transaction, when closed, will strengthen the Company’s end-to-end medical cannabis operations and infrastructure in Germany, a key market in Aphria’s international expansion. It is anticipated that the transaction will close in January 2019.
“This acquisition strengthens our foothold in Germany, one of the most highly sought-after medical cannabis markets in the world,” said Vic Neufeld, CEO of Aphria. “CC Pharma is cash-flow positive and has significant experience with regulatory requirements and international logistics. It will be a strong addition to Aphria’s presence in Germany, providing deeper access to the important pharmacist channel and advancing our ambitious global growth strategy.”
The transaction will bolster Aphria’s growing presence in Germany, which includes a three-pronged approach covering demand, supply, and distribution. Earlier this year, the Company, through its wholly-owned subsidiary Aphria Deutschland acquired a 25.1 percent interest in Berlin-based Schöneberg Hospital, providing access to both doctors and patients to support education about the benefits of medical cannabinoids. It was also the first step in Aphria Germany’s plans to build and operate pain treatment centres throughout Germany.
To secure a constant delivery of imported cannabis for German patients, the Company is building one of the biggest state-of-the-art GMP certified cannabis vaults in Bad Bramstedt, northern Germany, with a storage capacity of 5,000 kilograms. To prepare for in-country cultivation in Germany, Aphria is planning on building a Research and Development indoor growing facility in Neumünster, Germany.
“We are focused on leading the way in the medical cannabis market in Germany,” said Hendrik Knopp, managing director of Aphria Germany. “By combining Aphria’s expertise with CC Pharma’s established local market presence, we are well positioned to continue on that journey.”
Aphria will pay €24.5 million ($27,900,000) in cash to CC Pharma at closing, with an earn-out multiple on future EBITDA of up to another €23.5 million following closing, if certain performance milestones are met.
(Source: Aphria Inc.)
