Benzinga | Oct 26, 2020 11:35AM EDT

Andina Acquisition Corp. III Offers Update On Deal With EMMAC Life Sciences

Andina Acquisition Corp. III (NASDAQ:ANDA, ANDAW, and ANDAU))) ("Andina") and EMMAC Life Sciences Limited ("EMMAC") jointly provided an update regarding their continued progress towards signing a business combination agreement, pursuant to which EMMAC is anticipated to become a publicly traded company on the NASDAQ Stock Market with EMMAC's shareholders receiving equity in the combined public company in exchange for their equity in EMMAC. As consideration for the transaction, it is anticipated that the current EMMAC shareholders would collectively own a majority of the equity of the combined public company.

Andina and EMMAC previously announced that they had signed a non-binding letter of intent (the "LOI") relating to a business combination on July 22, 2020. The Companies anticipate being able to announce progress towards the execution of a business combination agreement in the near term. In the interim, EMMAC continues to receive support from its shareholders, among them leading institutional investors, allowing it to continue its investment in its business and maintain its growth trajectory.

Completion of the business combination is subject to, among other matters, the completion of due diligence, the negotiation and execution of a definitive agreement for the business combination, satisfaction of the conditions negotiated therein and approval of the transaction by Andina stockholders. Accordingly, there can be no assurance that a definitive agreement will be entered into or the proposed transaction will be consummated on the terms or timeframe currently contemplated, or at all. Any transaction would be subject to the approval of the board of directors and shareholders of each of Andina and EMMAC, as well as other customary conditions.

Luke Weil, Executive Chairman of Andina, and Julio A. Torres, CEO of Andina, said, "We remain confident that EMMAC is an attractive investment opportunity and would be a tremendous merger partner for Andina. We therefore look forward to providing additional information regarding the status of the proposed transaction soon. EMMAC continues to invest in its business to cement its position in Europe, and the recent operational progress of EMMAC gives us great confidence that it can deliver significant value for shareholders in 2021."

Lorne Abony, Executive Chairman of EMMAC, and Antonio Costanzo, CEO of EMMAC, said, "We continue to pursue opportunities within the European cannabis market and the third quarter of 2020 was one of continued investment in the business and growth for the Company, with the operational team achieving a number of important milestones despite continued headwinds caused by the COVID-19 pandemic and ongoing regulatory change. We are also working hard to reach a definitive agreement with Andina, as their team possesses significant experience assisting companies like ours and will add significant value to us as a strategic partner."

EMMAC is Europe's largest independent cannabis company, bringing together cutting-edge scientific research with the latest innovations in medical cannabis cultivation, extraction and production. EMMAC is a trusted cannabis partner for the medical and wellness communities and a leader in the production and supply of medical cannabis, wellness CBD, hemp, and other derivative products with large scale, low-cost, cultivation, EU-GMP manufacturing and processing, import/distribution network across all critical European markets. EMMAC has established pharmaceutical and medical cannabis manufacturing credibility and a direct-to-patient pharmacy license, multiple take-or-pay contracts for wholesale cannabis, and a strong portfolio of wellness brands and wellness products. EMMAC is also the first European cannabis company to sell and export product to Israel and is anticipated to launch white-label CBD products in the U.S.

Cowen and Craig-Hallum are serving as financial and capital markets advisors to Andina and Ellenoff Grossman & Schole LLP is serving as legal advisor to Andina. Stifel is serving as financial advisor to EMMAC. Winston & Strawn LLP is serving as legal advisor to EMMAC.

Recent EMMAC Business Developments

* On October 16, 2020, EMMAC announced the commencement of UK manufacture of its range of premium medical cannabis products. Rokshaw Laboratories ("Rokshaw"), EMMAC's wholly owned subsidiary and a leading UK MHRA-approved Specials Manufacturer, received its first commercial shipment of medical cannabis Active Pharmaceutical Ingredient ("API") from Medalchemy S.L., EMMAC's subsidiary that operates its Good Manufacturing Practice ("GMP") certified manufacturing site in Alicante, Spain ("Medalchemy"). Medalchemy will begin exporting medical cannabis API to other countries in the coming months. We believe the shipment also validates EMMAC's business model, as it demonstrates that the vertically integrated supply chain, from its cultivation facilities in Portugal to its two EU-GMP processing facilities, laboratories and importation and distribution capabilities in key markets across Europe, yields high-quality product and the most competitive price points. The integrated supply chain significantly reduces the market price of medical cannabis for patients in the UK, and notably brings costs below black-market prices for many patients (who may be currently self-medicating).

* On August 18, 2020, EMMAC announced that EMMAC SAGL, the Group's pharmaceutical entity in Switzerland, has secured its Good Distribution Practice ("GDP") license for the distribution of medicinal products. EMMAC now has the ability to import, distribute and export medicinal products, including medical cannabis, for the domestic Swiss, EU and international markets.

* On July 28, 2020, EMMAC announced that Medalchemy, the Group's Good Manufacturing Practice ("GMP") certified manufacturing site in Alicante, Spain, has secured approval from the Spanish Health Authorities ("AEMPS") to cultivate medical cannabis. Medalchemy now has fully integrated cannabis supply facilities, with a license to grow medical cannabis commercially as well as extract and manufacture cannabis extract as an API. EMMAC now holds multiple medical cannabis licenses in four countries across Europe.