- Green Rise Foods (GRF) is looking to grow its cultivation abilities with the purchase of Ontario-based Mor Gro Farms
- Mor Gro owns a 22-acre greenhouse in Kingsville, which will be purchased by Green Rise for C$15.5 million
- The purchase will be funded through a combination of cash on hand and mortgage financing
- The acquisition represents a 60 per cent increase in the cultivation capabilities of the company
- Green Rise Foods is currently steady at $1.28 per share
Green Rise Foods (GRF) is looking to grow its cultivation abilities with the purchase of Ontario-based Mor Gro Farms.
Under the terms of an asset purchase and sale agreement, the Toronto-based fresh produce grower will acquire Mor Gro’s 22-acre greenhouse in Kingsville, which sits within a 57-acre black of farmland.
The company will pay a total of $15.5 million for the purchase, which will be funded through a combination of cash on hand and conventional mortgage financing.
Green Rise says the deal is expected to close on February 1 next year – pending approval from the TSX Venture Exchange – and, once complete, will represent a 60 per cent increase to its cultivation capabilities.
“The increased production allows GRF to increase its buying power and with that the ability to improve the company’s gross margins,” said Vincent Narang, CEO of Green Rise Foods.
“The acquisition includes packing technologies which we expect will improve labor costs and product quality,” he added.
Today’s announcement noted that Green Rise remains focused on evaluating other high-returns opportunities in greenhouse food production – a strategy it says positions the company well for future growth.
In early November, Green Rise published its third quarter financial results, which outlined a $1.3 million increase in revenue for the first 9 months of 2020, from $11.3 million last year to $12.6 million.
This increase was primarily due to an 18 per cent increase per pound in the price of beef stake tomatoes sold compared to the prior year period.
The company’s share price over the year has also reflected the promising results, with a 509 per cent increase since the start of January.
Green Rise Foods is currently steady at $1.28 per share as of 12:14pm EST.
