Nebu Resources Inc. Provides Update on Amended Proposed Business Combination Transaction and Change of Business, Partial Settlement of Corporate Debt and Disposition of Certain Assets

Toronto, Ontario–(Newsfile Corp. – February 7, 2020) – Nebu Resources Inc. (TSXV: NBU) (“Nebu” or the “Company“) is pleased to announce that it has executed a letter of intent with Phoenix Bioinvestments Corp. and its affiliated companies located in Pueblo, Colorado (collectively, “Phoenix“) to acquire 100% of the issued and outstanding shares of Phoenix for consideration paid by the issuance common shares (“Common Shares“) of the Company, with such transaction conditional on the completion of certain financing and other matters described herein (the “Business Combination Transaction“).

Details regarding the final structure of the transaction, financing conditions, concurrent financing, proposed board, management, business growth, financial conditions as well as any additional details prescribed by the TSX Venture Exchange (“TSXV“) or applicable regulatory bodies as the case may be, will be provided in a subsequent press release.

The parties intend to complete an audit review of Phoenix, finalize all definitive agreements in connection therewith and to file applicable documentation to complete the Business Combination Transaction as soon as possible.

The purpose of the Business Combination Transaction is to finance and accelerate the development and expansion of Phoenix’s “advanced biosciences,” business-to-business supply chain operations with state of-the -art processing, compliant life sciences product formulation, manufacturing methodologies, and the distribution of hemp-oil based products compliant with Section 7606 of the 2014 U.S. Farm Bill in the United States, Canada and select global markets.

Phoenix’s core business focus is to provide hemp-extraction services at multiple licensed facilities to process hemp biomass into various grades of hemp oil, distillate and isolate for use in products by companies and end-consumers. Phoenix also has a portfolio of formulations and ingredients for use with private label customers and products that are being positioned with third-party joint venture partners.

Several leading industry research groups including BDS Analytics, Arcview Market Research and the Brightfield Group have sized the market for CBD products in the US market alone at about US$591 million in 2018, growing to the $20 billion range by 2022-204.

Nebu has previously announced a potential conditional transaction with Farris Holdings Group Inc. (“FHGI”). In connection with the opportunity with Phoenix and its exclusive focus on hemp and CBD markets, Nebu has narrowed its discussions with FHGI to provide capital and/or to arrange certain equipment financing for FHGI’s processing business and to secure certain rights to develop a hemp-flower and hemp-cigarette processing and distribution services businesses and to pursue certain commercial or joint business development opportunities for Phoenix in California in the hemp business. Such arrangements are expected to be finalized in the next 30 days, or prior to the filing of applicable re-listing forms. As partial consideration for the granting of such rights is expected to be paid in the form of shares of Nebu in a number to be determined, and subject to approval by the applicable stock exchange and regulatory authorities.

Further, Nebu is also pleased to announce that it has executed a letter of intent agreement on the date hereof to sell its existing mining assets immediately to a private non-affiliated third party as directed by certain creditors in connection with the repayment of certain promissory notes and accrued interest in connection therewith and agrees to issue 1,000,000, Common Shares to be issued at the time of completion of the Business Combination Transaction, subject to entering into of approval of the applicable stock exchange or other regulatory approvals.

Nebu is currently listed on the TSXV with its shares halted for trading pending a reverse take-over transaction.

As a condition of the proposed transaction, Nebu intends to make an application for listing of the Common Shares of Nebu on the Canadian Stock Exchange. Upon receipt of such approval, Nebu will request that its common shares be voluntarily de-listed from the TSXV, subject to additional regulatory approvals as applicable.

The Common Shares of Nebu will remain halted pending the review of these matters by the TSXV.

For further information please contact:

Paul Crath
Interim Chief Executive Officer and Director
Nebu Resources Inc.
Telephone: 416-845-7289 (Canada)
347-835-9032 (USA)

Forward Looking Information

“Completion of the transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable, disinterested shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of Nebu should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this news release.”

This news release contains certain forward-looking statements that reflect the current views and/or expectations of management with respect to performance, business and future events, including but not limited to express or implied statements and assumptions regarding the Company’s intention to negotiate for or complete the Transaction. Forward-looking statements are based on the then-current expectations, beliefs, assumptions, estimates and forecasts about the business and the industry and markets in which the Company operates. Forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions which are difficult to predict. In particular, there is no guarantee that the parties will successfully negotiate and enter into a definitive agreement or complete the Transaction contemplated herein, that the Company’s due diligence will be satisfactory or that the Company will obtain any required shareholder or regulatory approvals, including approval of the TSX Venture Exchange . Accordingly, readers should not place undue reliance on forward-looking statements and information, which are qualified in their entirety by this cautionary statement. The Company does not undertake any obligations to release publicly any revisions for updating any voluntary forward-looking statements, except as required by applicable securities law.

All information contained in this press release with respect to Phoenix, their business and proposed corporate reorganization and financing was supplied by Phoenix for inclusion herein. The Company has not conducted due diligence on the information provided and does not assume any responsibility for the accuracy or completeness of such information.

Neither the TSX Venture Exchange nor its Regulations Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

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