The Creso Pharma Ltd (ASX: CPH) share price is surging today, up 9% in morning trade.
Below we take a look at the latest acquisition news that appears to be stoking interest in the ASX cannabis share.
Image source: Getty Images
What acquisition was reported?
The Creso Pharma share price is leaping higher after the company reported that it has entered into an asset purchase agreement for the purchase of brand and product portfolio assets owned by ImpACTIVE.
Canadian life sciences company, ImpACTIVE, is focused on CBD-based products offering anti-inflammatory relief to professional and amateur athletes.
Creso said it will acquire the ImpACTIVE Assets through a newly incorporated Creso subsidiary, Creso ImpACTIVE Ltd. Creso will pay C$200,000 (AU$217,000) in Creso Shares, valued at 11 Australian cents per share. That's below the current Creso Pharma share price of 12 cents.
The acquisition is intended to increase Creso's CBD offerings in the North American markets. With the ImpACTIVE products containing less than 0.3% THC (the active ingredient in cannabis that gets people "high"), the company said this will "significantly" reduce global regulatory issues.
Commenting on the deal, Creso's executive VP of North America, Will Lay said:
This acquisition marks the first phase of Creso Pharma's efforts to enter into the US and I am excited to be working with ImpACTIVE to integrate them into the group. We have instituted aggressive sales targets, which is expected to lead to an increase in Creso Pharma's top line and increased its market share across North America.
Non-executive chairman, Adam Blumenthal added:
We expect that ImpACTIVE's range of innovative products and brand ambassadors which will provide Creso Pharma with direct access to an emerging subsection of the global CBD market. The group also has established relationships with major US retail groups, which is expected to provide leverage for Creso Pharma as it seeks to grow sales of its own hemp based CBD products.
Creso Pharma share price snapshot
The Creso Pharma share price has been a stellar performer over the past 12 months, up a whopping 283%. That compares to a gain of 22% posted by the All Ordinaries Index (ASX: XAO) over the last full year.
Over the past month, Creso Pharma shares have gained 5%.
