Along with the announcement today regarding their upcoming 7,500 patient study, came some more great news for Canabo Medical Inc. (OTC:CAMDF) (TSXV:CMM). Canabo entered into a private placement deal today with Aphria Inc. (OTC:APHQF) (TSXV:APH) to raise gross proceeds of $8,400,000 CAD. This is equivalent to roughly $6,349,686 USD at current foreign exchange rates.

Exciting Partnership

According to Canabo's Executive Chairman Dr. Neil Smith, "adding an investment partner like Aphria is an obvious strategic partner aligned to advance the standard of cannabinoid treatments." Vic Neufeld, CEO of Aphria commented, "we very much look forward to working closely with [Canabo] as part of this strategic investment."

Details of the Deal

The deal is for the private placement of 6 million shares of Canabo common stock.

The price of the deal was set at $1.40 CAD per share.

Gross deal proceeds equal $8.4 million CAD.

Following this offering, Aphria will be own approximately 16.6% of Canabo's issued and outstanding common stock (undiluted).

This deal values Canabo at over $50.6 million CAD.

The deal is also subject to a finders fee which is equal to 5% of the gross proceeds, or $420,000 CAD.

This fee is payable to Haywood Securities Inc., PowerOne Capital Markets Ltd., and Clarus Securities Inc.

Additionally, Haywood Securities was granted an over-allotment option to sell additional shares of Canabo until 30 days following the deal's close date.

This grants Haywood Securities the option to sell additional shares of Canabo equal to 15% of the offering, or 900,000 more shares.

The deal is still subject to regulatory and exchange approvals.

More About Canabo

Canabo wholly owns and operates Cannabinoid Medical Clinics, or CMClinics in Canada. This is Canada's largest chain of referral-only medical cannabis clinics. Having opened back in 2014, Canabo now operates 10 referral-only medical cannabis clinics, with a handful more expected to open by early 2017.

According to their release regarding the deal, "the principal business carried on and intended to be carried on by Canabo is the operation of strictly referral-only medical clinics for evaluating the suitability of, prescribing, and monitoring cannabinoid treatments for patients suffering from chronic pain and disabling illnesses. Clinics operated by Canabo are staffed by physicians and qualified health care practitioners specifically trained to assess patient suitability for cannabinoid treatment, recommend treatment regimes, and monitor treatment progress. Canabo sees patients only on a physician-referral basis. The Access to Cannabis for Medical Purposes Regulations (“ACMPR”) requires that medical marijuana must be prescribed by a health care practitioner; however, no cannabinoid products or medical marijuana are sold at Canabo’s medical clinics."

Conclusion

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