“We’re creating something the world doesn’t have”: Zelda boss on US merger
Health & Biotech
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Current Zelda Therapeutics (ASX:ZLD) boss Dr Richard Hopkins cut an animated figure at a media briefing for his company’s proposed merger with US-based Ilera Therapeutics last week.
And while the market hasn’t exactly followed suit — shares bounced a maximum of 7 per cent on the news but have since fallen to their lowest point in a month — Dr Hopkins wanted to assure everyone the company has made the right decision.
“Some feel like we’re giving up too much value, but we’re not giving up any value at all,” he said. “It makes sense to do this now, and our job now is to execute.”
The merger, if approved by shareholders and the courts, will see the two companies become Zelira Therapeutics, a “globally integrated” medicinal cannabis company, that will remain listed on the ASX and potentially down the track on the NASDAQ.
The attractiveness that Dr Hopkins was at pains to explain was the synergies a merging of the companies offers both businesses. Ilera offers Zelda an on-the-ground, established presence in the US, while Zelda offers Ilera the ability to conduct medicinal cannabis clinical trials.
“By bringing together these two companies we’re creating something the world doesn’t have,” Dr Hopkins said. “They have the footprint and we can access their infrastructure.
“But because cannabis is federally illegal in the US, they can’t touch the plant, whereas we can.”
Zelira will get around federal laws by looking to partner with distributors who have operations in multiple states, such as Columbia Care.
Dr Hopkins said the deal would see Zelda transform from a stock-standard, pre-revenue biotech to a vertically-integrated, money-making, global medicinal cannabis company.
“You cannot stand still in the cannabis market,” he said. “This merger will make us highly differentiated from other medicinal cannabis companies and deliver more value to shareholders at a faster rate.”