Encourages Shareholders to Vote Well in Advance of the Proxy Deadline of 9:30 a.m. (Eastern time) on August 23, 2024
TORONTO, Aug. 19, 2024 /PRNewswire/ - August 19, 2024 - RIV Capital Inc. ("RIV Capital" or the "Company") (CSE: RIV) (OTC: CNPOF), an acquisition and investment firm with a focus on building a leading multistate platform with one of the strongest portfolios of brands in key strategic U.S. markets, and Cansortium Inc. (CSE: TIUM.U) (OTCQB: CNTMF) ("Cansortium"), a vertically integrated, multi-state cannabis company operating under the FLUENT? brand, today provided an update on the integration activities currently underway, in preparation for the completion of the previously announced business combination.
RIV Capital Inc. Logo (CNW Group/RIV Capital Inc.)
"As we work to complete this transaction, we are taking immediate action by commencing integration activities that will best position the combined company for long-term success across our respective markets," said Mike Totzke, COO and interim CEO of RIV Capital. "The steps we are taking now will streamline our processes, improve our operational efficiency, and importantly, broaden our product and brand portfolio. We are thrilled to begin working closely with the Cansortium team and excited for our patients and customers in New York that will get to experience the benefits of our combined company, now."
"Our upcoming business combination will strongly position Cansortium and RIV as leaders in some of the most exciting growth markets in the country," said Robert Beasley, Chief Executive Officer of Cansortium. "With a number of key catalysts ahead in New York and Florida we are well on our way to integrating our businesses to ensure we hit the ground running upon completion. Our shared focus remains on driving growth and profitability by leveraging our core strengths in cultivation, operating expertise and inventory optimization to drive results for shareholders."
Since announcing the business combination in May 2024, RIV Capital and Cansortium have completed the following integration activities to best position the combined company for success upon completion of the transaction:
Adopting Best Practices and SOPs Across the Organization: A comprehensive review of the Company's Chestertown facility has been completed and RIV Capital has begun implementing Cansortium's best practices and standard operating procedures (SOPs), which is intended to enhance operational efficiency and improve quality standards.
Strategic Production Planning: The integration team has aligned sales and operations planning meetings to facilitate strategic production planning. This unified function will ensure that both sales forecasts and production capabilities are considered in decision-making, optimizing inventory levels and ensuring timely delivery of products to meet market demand.
Expanding House of Brands: Plans are underway to combine the brands of both businesses, including a near-term introduction of Fluent's brands into the burgeoning New York market. The combination is expected to broaden the consumer reach in current geographies and enhance national brand recognition as the combined company expands into new geographies.
Innovative Product Launches: Leveraging Cansortium's innovative SKU portfolio, RIV Capital is expanding its product assortment for the New York market. Plans are in place to launch a series of new items in the coming months, including, and not limited to: vaporizer innovation, concentrates, edibles, and infused pre-rolls.
Strategic Capital Deployment: Investments have been made in advanced production equipment to enhance the Company's capability to produce higher-quality, customer-sought products. This strategic capital deployment aims to maximize ROI by expanding product lines and improving production efficiency, thereby catering to evolving consumer preferences.
Enhancing the In-Store Customer Experience: Under the leadership of Dave Vautrin, the Company's new Chief Retail Officer, the in-store experience at Etain's locations is being revamped. Incorporating elements from Fluent's successful retail strategies, the Company aims to create a more engaging, customer-friendly environment, to improve customer satisfaction and drive sales through a more cohesive brand presentation.
Reminder to Vote
The upcoming Annual General and Special Meeting of Shareholders will be held on Tuesday, August 27, 2024 at 9:30 a.m. (EDT). RIV Capital urges shareholders to review the Management Information Circular filed in connection with the proposed business combination and to vote well before the deadline of 9:30 a.m. (EDT) on August 23, 2024.
Your vote is critical no matter how many shares you own. If you have questions regarding how to vote, contact the company's transfer agent, Odyssey Trust Company, at 1(888) 290-1175 toll free in North America, or at 1(587) 885-0960 outside of North America, or by e-mail at [email protected].
About Cansortium
Cansortium is a vertically-integrated cannabis company with licenses and operations in Florida, Pennsylvania and Texas. The Company operates under the FLUENT? brand and is dedicated to being one of the highest quality cannabis companies for the communities it serves. This is driven by Cansortium's unrelenting commitment to operational excellence in cultivation, production, distribution and retail. The Company is headquartered in Tampa, Florida. For more information about the Company, please visit www.getFLUENT.com.
About RIV Capital
RIV Capital is an acquisition and investment firm with a focus on building a leading multistate platform with one of the strongest portfolios of cannabis brands in key strategic U.S. markets. Backed by in-house expertise and cannabis domain knowledge, RIV Capital aims to grow its own brands and partner with established U.S. cannabis operators and brands to bring them to new markets and build market share. RIV Capital established the foundational building blocks of its active U.S. strategy with its previously announced acquisition of Etain. Through its strategic relationship with The Hawthorne Collective, Inc. ("The Hawthorne Collective"), a subsidiary of The ScottsMiracle-Gro Company ("ScottsMiracle-Gro"), RIV Capital is The Hawthorne Collective's preferred vehicle for cannabis-related investments not under the purview of other ScottsMiracle-Gro subsidiaries.
Forward Looking Statements
This news release contains statements which constitute "forward-looking information" within the meaning of applicable securities laws. Often, but not always, forward-looking statements and information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "enables", "intends", "anticipates" or "does not anticipate", "potential", "seeks" or "believes", or variations of such words and phrases, or state that certain actions, events or results "may", "can", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements or information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Cansortium, RIV Capital or their respective subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements or information contained in this news release. Examples of such statements include, but are not limited to, statements regarding: the timing and completion of the proposed business combination between RIV Capital and Cansortium; the anticipated benefits and synergies created by ongoing integration activities and the impact such activities will have on the financial and operating performance of RIV Capital, Cansortium, and the combined company, including, but not limited to, operational efficiencies, expanded product and brand portfolios, and improvements to the in-store customer experience; expectations regarding the ability of RIV Capital, Cansortium, or the combined company's ability to achieve or take advantage of such anticipated benefits; the estimated growth opportunities as a result of the business combination and ongoing integration activities, including the combined company's total addressable market at maturity; expectations regarding the U.S. cannabis market; and expectations for other economic, business and/or competitive factors.
Investors are cautioned that forward-looking information is not based on historical fact but instead reflects management's expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although RIV Capital believes that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of RIV Capital or its portfolio companies.
Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information include: the prompt and effective integration of Cansortium's and RIV Capital's businesses and the ability to achieve the anticipated synergies contemplated by the business combination and ongoing integration activities; the diversion of management time on issues related to the business combination transaction; expectations regarding future investment, growth and expansion of Cansortium's and RIV Capital's operations; regulatory and licensing risks; Cansortium's and RIV Capital's reliance on licenses issued by state authorities; future levels of revenues and the impact of increasing levels of competition; changes in laws, regulations and guidelines and Cansortium's and RIV Capital's compliance with such laws, regulations and guidelines; the timing and manner of the legalization of cannabis in the United States; business strategies, growth opportunities and expected investment; the potential effects of judicial, regulatory or other proceedings, litigation or threatened litigation or proceedings, or reviews or investigations, on Cansortium's and RIV Capital's business, financial condition, results of operations and cash flows; risks associated with divestment and restructuring; the anticipated effects of actions of third parties such as competitors, activist investors or federal, state, provincial, territorial or local regulatory authorities, self-regulatory organizations, plaintiffs in litigation or persons threatening litigation; consumer demand for cannabis; risks related to stock exchange restrictions; risks related to the protection and enforcement of Cansortium's and RIV Capital's intellectual property rights; future levels of capital, environmental or maintenance expenditures, general and administrative and other expenses; changes in general economic, business and political conditions, including changes in the financial and stock markets; inflation risks; risks relating to the economic impacts caused by the ongoing conflicts in Europe and the Middle East; risks relating to anti-money laundering laws; compliance with extensive government regulation and the interpretation of various laws, regulations, and policies; public opinion and perception of the cannabis industry; and such other risks contained in the public filings of Cansortium filed with Canadian securities regulators and available under Cansortium's profile on SEDAR+ at www.sedarplus.ca and in the public filings of RIV Capital filed with Canadian securities regulators and available under RIV Capital's profile on SEDAR+ at www.sedarplus.ca, including RIV Capital's annual information form for the year ended March 31, 2023, annual management's discussion and analysis for the nine-month period ended December 31, 2023, and management information circular dated July 12, 2024 under the heading "Risk Factors".
Cansortium and RIV Capital, through several of their respective subsidiaries, are directly involved in the manufacture, possession, use, sale, and distribution of cannabis in the adult-use and medical cannabis marketplace in the U.S. Local state laws where Cansortium and RIV Capital operate permit such activities, however, investors should note that there are significant legal restrictions and regulations that govern the cannabis industry in the U.S. Cannabis remains a Schedule I drug under the U.S. Controlled Substances Act, making it illegal under federal law in the U.S. to, among other things, cultivate, distribute, or possess cannabis in the U.S. Financial transactions involving proceeds generated by, or intended to promote, cannabis-related business activities in the U.S. may form the basis for prosecution under applicable U.S. federal money laundering legislation.
While the approach to enforcement of such laws by the federal government in the U.S. has trended toward non-enforcement against individuals and businesses that comply with adult- use and medical cannabis programs in states where such programs are legal, strict compliance with state laws with respect to cannabis will neither absolve Cansortium and RIV Capital of liability under U.S. federal law, nor will it provide a defense to any federal proceeding which may be brought against Cansortium or RIV Capital. The enforcement of federal laws in the U.S. is a significant risk to the business of Cansortium and RIV Capital and any proceedings brought against Cansortium or RIV Capital thereunder may adversely affect operations and financial performance.
Should one or more of the foregoing risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although Cansortium and RIV Capital have attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The forward-looking information and statements included in this news release are made as of the date of this news release and Cansortium and RIV Capital do not undertake any obligation to publicly update such forward-looking information to reflect new information, subsequent events or otherwise unless required by applicable securities laws.