American Green, the cannabis-focused technology company that purchased the California town of Nipton with plans of turning it into a destination for cannabis tourism, has transferred its holdings in the town to Delta International Oil & Gas Inc. in a $7.73 million deal. The company had originally purchased the town for $5 million.
The deal will see American Green manage Nipton and associated projects for five years with a five-year option. American Green Chairman Davis Gwyther said the transaction relieved the company “of the on-going expense of improving Nipton,” calling the deal “a win-win” for the company and its shareholders.
“That responsibility [of improving Nipton] will now fall upon Delta, giving Nipton the ability to access cheaper capital through a fully reporting company, including the ability to file registered offerings. American Green can now expend less of its energy on capital raising, and focus on implementing the revenue-generating components of Nipton, and its other investments, along with many new, and exciting projects on the horizon.” – Gwyther in a press release
The release notes that, despite reports, cannabis cultivation was “not and never has been” the company’s immediate intent for the area.
“Only when, and if, American Green (as manager) and Delta (as owner) receive full approval from the relevant controlling authorities, would Nipton move, responsibly, into the cannabis product development sector.” – American Green in a press release
At closing, Delta will assume about $3.73 million in American Green debt and issue $4 million in Delta Series A stock convertible to 160,000,000 shares of Delta common stock. The deal is expected to close in 7-10 days.
Get daily cannabis business news updates. Subscribe
End