Digipath Enters into Letter of Intent to Acquire Clinical Lab Companies
Jan 17, 2017, 08:00 ET
LAS VEGAS, Jan. 17, 2017 /PRNewswire/ -- Digipath, Inc. (OTCQB : DIGP), an independent cannabis lab testing and media firm, has entered into a non-binding Letter of Intent under which it would acquire two affiliated full service independent clinical laboratories.
The acquisition targets consist of a family-owned laboratory established in 1948, based in Northern New Jersey, providing clinical laboratory services and toxicology testing, and an affiliated fully licensed clinical laboratory operating in New Jersey and Pennsylvania that specializes in toxicology services for pain-management physicians and addiction specialists. Both companies provide a broad range of diagnostic tests (blood, urine, cholesterol, drug) for patients, physicians, nursing homes, assisted living facilities, and drug and alcohol treatment programs and clinics.
The diagnostic/pathology lab testing market is estimated to be $65 billion in size, is highly fragmented, and has strong growth characteristics. Digipath believes that the highly fragmented nature of the cannabis testing industry has created substantial consolidation opportunities, and is focused on replicating the Digipath Labs model in other cannabis-legal states, both through organic growth and acquisition. Digipath intends to use a combination of cash and shares of its publicly-traded equity as consideration for its acquisitions.
Todd Denkin, Digipath Labs President, commented, "Pursuing acquisition opportunities in the clinical/diagnostic lab testing market provides both strategic and financial opportunities for Digipath and its shareholders. For those diagnostic lab companies we acquire that are domiciled in states where cannabis is legal or is expected to become so, cannabis lab testing could become an additional service offering by leveraging our expertise and know-how. Digipath management believes that the execution of its acquisition strategy will drive shareholder value by strengthening its market offering, market position, and reputation."
About Digipath, Inc.
Digipath, Inc. is an independent cannabis testing and media firm that supports the cannabis industry's best practices for reliable testing and delivers cannabis news coverage and education about the cannabis industry. Digipath's two business units are Digipath Labs and TNM News Corp. Digipath Labs™ is working to set the industry standard for testing all forms of cannabis-based products using FDA-compliant laboratory equipment and proprietary standard operating procedures (SOP) to ensure product safety and efficacy. TNM News Corp. has pioneered a cannabis-focused news network, The National Marijuana News, which delivers news, interviews, and education on all things cannabis.
For more information please visit http://www.Digipath.com/
Forward-Looking Statements
This press release contains "forward-looking statements" that include information relating to future events, and future financial and operating performance. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management's good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in, or suggested by, the forward-looking statements. Important factors that could cause these differences include, but are not limited to: the Company's need for additional funding, governmental regulation of the cannabis industry, the demand for the Company's products, the introduction of new products, the Company's ability to maintain customer and strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of the Company's liquidity and financial strength to support its growth, and other information that may be detailed from time-to-time in the Company's filings with the United States Securities and Exchange Commission. For a more detailed description of the risk factors and uncertainties affecting Digipath, please refer to the Company's recent Securities and Exchange Commission filings, which are available at www.sec.gov. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
Investor Relations Contact
Harrison Phillips
Viridian Capital Advisors, LLC
212-209-3086
[email protected]
SOURCE DigiPath, Inc.