SOMAÍ Pharmaceuticals Acquires RPK Biopharma (Holigen), Reinforcing Global Leading Position in Medicinal Cannabis Sector

SOMAÍ Pharmaceuticals Unipessoal LDA ("SOMAÍ"), an EU-GMP European pharmaceutical and biotech company distributing cannabinoid-containing pharmaceuticals globally, today announced it has entered into a definitive agreement with AKANDA Corp. (U.S. NASDAQ: AKAN), an international medical cannabis company, to acquire 100% off of the issued and outstanding shares of its Portuguese subsidiary RPK Biopharma (Holigen). The acquisition will significantly accelerate SOMAÍ's global leadership, improving the Company's ability to deliver a ground-breaking differentiated cannabinoid-containing product portfolio to meet patients' needs worldwide.

SOMAÍ Pharmaceuticals Unipessoal LDA ("SOMAÍ"), an EU-GMP European pharmaceutical and biotech company distributing cannabinoid-containing pharmaceuticals globally, today announced it has entered into a definitive agreement with AKANDA Corp. (U.S. NASDAQ: AKAN), an international medical cannabis company, to acquire 100% off of the issued and outstanding shares of its Portuguese subsidiary RPK Biopharma (Holigen). The acquisition will significantly accelerate SOMAÍ's global leadership, improving the Company's ability to deliver a ground-breaking differentiated cannabinoid-containing product portfolio to meet patients' needs worldwide.- This strategic acquisition enhances SOMAÍ's capacity with best-in-class cultivation, manufacturing, and distribution assets, making it one of the few verticals in the EU able to cater to the diverse needs of fast-growing European cannabis markets.- SOMAÍ will have an immediate dried flower market leadership position, a significantly expanded product portfolio, and a partnership with a world-renowned Cookies brand.- SOMAÍ will gain access to distribution channels in various EU markets with key distribution partners in Germany and the UK, including German market leader Cansativa.The strategic acquisition of RPK Biopharma (Holigen), a Portugal-based cultivator, manufacturer, and distributor, provides SOMAÍ with both the capacity and route-to-market for delivering top-quality EU-GMP certified medicinal cannabis to legal markets globally. Holigen’s wholly owned subsidiary RPK Biopharma Unipessoal, Lda (“RPK”), consists of a 25,000 square foot indoor EU-GMP certified grow facility located near Lisbon (in Sintra) dedicated to the cultivation of high-THC premium cannabis flower as well as a large seven million square foot (180+ acres) outdoor facility located two hours south in Aljustrel. Combined, the Company believes these facilities will provide the flexibility of capacity in Portugal to produce two tonnes of premium indoor cannabis flower, over 100 tonnes of outdoor cannabis flower that can be used for high-quality extraction material, and over ten tonnes of additional manufacturing capacity annually.Holigen’s best-in-class indoor grow facility is one of a few facilities that can produce EU-GMP medical cannabis equivalent to the recreational grades available in North America. SOMAÍ will also benefit from the existing supply agreements and key partnerships with top distributors in Germany, the UK, and Australia. Holigen, through its strong partnership with Cansativa, has already had one of the most successful launches into the German market, supplying over 1000kgs of Strawberry Banana and Cherry Pie. The company is preparing for a significant market launch of Cookies branded products in 2024.Key Transaction HighlightsBusiness synergies. The acquisition brings together two international medical cannabis companies with complementary assets; SOMAÍ, as a manufacturer and distributor of innovative cannabis-based medical products, and Holigen, as a cultivator, manufacturer, and distributor of high-quality dried flower. These two distinct assets and capabilities represent and service both the present and future largest cannabis market segments.EU-GMP-certified facility. The acquisition provides the Company with a second EU-GMP certification, bolstering SOMAÍ’s pharmaceutical credentials and opening direct international market access for dried flower.Enhanced cash flow generation. The absorption of Holigen into the group is forecast to result in €18 million consolidated revenues in the first year. The deal will further strengthen SOMAÍ's working capital, improve flower line margins and bring the group sharply to profitability with immediate accretion for shareholders.Unmatched global cannabis leadership. Holigen will add to SOMAÍ’s capabilities with advanced cultivation and overall cannabis expertise. Tom Flow, an internationally recognized cultivation professional with over 20 years of experience across a range of cannabis businesses, is expected to join SOMAÍ, subject to agreement and board approval.Cookies Brand Partnership. Through its existing partnership with Cookies, SOMAÍ and its clients now have access to the top cannabis brand in the world. The company is preparing for the exciting launch of Cookies branded products in the EU and UK.Key client relationships. SOMAÍ will gain access and benefit from Holigen’s distribution partners in key EU and UK markets. Holigen’s strong relationship with Cansativa in Germany will help propel the company’s growth trajectory through 2024, 2025, and beyond.Premium indoor cultivation. The Sintra facility is a 25,000-square-foot premium indoor facility designed to produce at least two tonnes of high-THC premium medical cannabis per year. The facility is one of a limited number of fully certified EU GMP indoor facilities currently operating in Europe.Large-scale outdoor cultivation. The Aljustrel facility is comprised of over seven million sq...