Creso Pharma and Red Light Holland call off merger, as NASDAQ beckons
Health & Biotech
Health & Biotech
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The proposed merger of Creso Pharma and Ontario-based psychedelics company Red Light Holland has been called off, allowing Creso to retain its listing on the ASX – and possibly, the NASDAQ.
Creso Pharma (ASX:CPH) said the mutual decision to terminate the merger, first announced in June, followed the company’s “ongoing review of market conditions and consultations with shareholders and institutional investors as well as COVID limitations.”
Significant travel restrictions from the surging Delta variant would have made it difficult for the two companies to integrate their global operations.
While the merger won’t go ahead, Creso and Red Light say they remain committed to a strong working relationship and moving forward as partners.
As such, Red Light has placed an order to purchase $170,000 of Creso Pharma’s hemp-based CBD products, which will be white-labelled for sale across Red Light’s sales channels.
“We are now shifting our resources and focus to the proposed NASDAQ dual listing,” said Creso Pharma non-executive chairman Adam Blumenthal.
Creso shares in June commenced trading on the US OTCQB market and is looking to upgrade that, hiring New York-based boutique corporate advisory firm EAS Advisors to assist them.
EAS was founded by Edward “Eddie” Sugar, a former managing director at Jefferies & Co. in New York.
Sugar says he’s been following Creso’s story “for some time” and is impressed with the progress that management has made.
“As a firm we are extremely excited to be engaged by Creso Pharma to assist with achieving such a milestone,” he said.
Creso is targeting the NASDAQ listing taking place in the first half of next year and Sugar said it could potentially unlock significant value for shareholders.
Creso is also watching regulatory shifts in North America, where 36 US states have legalised cannabis for medicinal use, and 18 have legalised it for recreational use.
Federal legislation has been introduced to legalise marijuana on the national level, which would let Creso import weed from its wholly-owned subsidiary in Ontario, Mernova Medicinal.
In California, a bill to legalise psychedelic compounds – like the psilocybin being studied by Creso’s Canadian subsidiary, Halucenex – has passed the state Senate and will be taken up by the Assembly next year.
“The company has achieved a number of milestones in recent months, which set a very strong foundation for growth,” Blumenthal says.
“We look forward to progressing a number of corporate and operational developments and unlocking value for our shareholders.”
This article was developed in collaboration with Creso Pharma, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.