GreeneStone Signs LOI to Acquire Aurora Recovery
Toronto, Canada, December 29, 2015 (Newswire.com) - GreeneStone Healthcare Corporation (OTCQB: GRST) (“GreeneStone” “GRST” or the “Company”), a provider of healthcare services including addiction and mental health, has signed a Letter of Intent outlining the terms of a proposed acquisition of the assets of Aurora Recovery Center LP ("Aurora"). The assets include two properties in Gimli, Manitoba and cash.
Aurora recently completed a renovation to convert a former resort property into a 72 bed addiction treatment facility. The facility is ideally suited to expand the offerings of GreeneStone. There are several categories of clientele that GreeneStone has been unable to service in its Muskoka, Ontario facility that it will be able to service from Gimli. Although the Gimli treatment center operated briefly under the Aurora banner, GreeneStone intends to revamp the operations to follow the GreeneStone model and philosophy of treatment. The 27 acre property sits on Lake Winnipeg approximately 5km north of the town of Gimli and has approximately 43,000 square feet of buildings. Also included in the assets is a 16 suite apartment building in the town of Gimli that will be used in conjunction with the treatment center. This brings the total capacity to 88 beds. GreeneStone will acquire CDN$1,000,000 in cash with the acquisition and this cash will be used for working capital purposes for the Gimli operations.
Mr. Shawn Leon, President and C.E.O. of the Company said, "This transaction is transformative for the Company. It not only dramatically increases the capacity for clients thereby stepping up the revenues significantly, but serves to strengthen the balance sheet so that the Company can proceed with previously announced plans to upgrade to a more senior market for trading in its securities. It also serves as a catalyst to complete the acquisition of the Company's Muskoka property and to add additional cash to the balance sheet through new equity placements."
Mr. Michael Bruneau, President of the General Partner of the Aurora Recovery Center LP said, "We believe that this deal not only gives all the investors in the Aurora limited partnership the opportunity to share in the future success of the Gimli center but to share in the success of the whole Company. We think the team at GreeneStone is the best possible partner to have in charge of the recovery center."
The transaction is conditional on signing comprehensive binding agreements prior to January 31, 2016 and is slated to close in February 2016. The total purchase price for the assets is CDN$12,500,000.00 and is being financed with CDN$8,500,000.00 in debt and the issuance of 60,000,000 shares of Company common stock. Details of the LOI will be in an 8k filing to the United States Securities and Exchange Commission in the next 48 hours.
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