CubicFarm Systems Corp. increases ownership interest in Artex Feed Solutions to 50%
Artex Feed Solutions well-positioned to sell CubicFarms’ HydroGreen automatic growing system for animal feed to markets worldwide
Vancouver, BC – (AccessWire – January 30, 2020) – CubicFarm® Systems Corp. (TSXV:CUB) (“CubicFarms” or the “Company”) announces that it has increased its shareholding in Artex Feed Solutions from 25% to 50%. Artex Feed Solutions is a joint venture company which is now 50% owned by CubicFarms and 50% owned by Artex Barn Solutions, a leader in agricultural supplies for over 40 years.
Artex Barn Solutions was founded by John de Jonge – also a board member of CubicFarms – who purchased Artex Barn and grew it into a global provider of cattle handling equipment, ventilation and cow cooling. He has deep expertise in establishing and scaling up multiple manufacturing facilities in China and North America.
CubicFarms has signed an authorized reseller agreement with Artex Feed Solutions – as announced in the Company’s press release dated December 11, 2019 – to market and sell its HydroGreen fully-automated hydroponic growing systems that produce live, green animal feed. This joint venture will allow the Company to capture a portion of the sales revenue that would ordinarily be paid out to third-party resellers.
The HydroGreen system sprouts grains, such as barley and wheat, in a controlled environment with minimal use of land, labour and water. The system performs all growing functions including seeding, watering, lighting, harvesting, and re-seeding – all with the push of a button – to deliver animal feed without the typical investment in fertilizer, chemicals, fuel, field equipment and transportation.
Artex Feed Solutions well-positioned to market and sell HydroGreen systems
Artex and Mr. de Jonge plan to leverage their dealership network in over 40 countries to sell the HydroGreen system, focusing first on markets in the USA and Canada, then on qualified leads in China, Indonesia and the Middle East – areas with substantial market potential due to changing food consumption patterns and supportive government policies toward agricultural technology.
Internationally, Artex dealers will target existing agriculture animal producers looking to enhance profitability and environmental sustainability, early-stage farmers with minimal capital and land constraints, small- to medium-size farms seeking feed alternatives to benefit their operations and urban farmers without access to land.
The HydroGreen system will become a key offering in Artex’s suite of products and solutions that are geared toward a well-designed barn to improve herd productivity and health, such as its line of Comfort Zone™ products designed to increase milk production, the DeLaval Voluntary Milking System™ milking robot, and Trident Processes’ wastewater treatment and manure management.
The arrangement with Artex Feed Solutions may be considered a related-party transaction subject to TSX-V Policy 5.9 and Multilateral Instrument 61-101 (“MI 61-101”). The Company will be exempt from the need to obtain minority shareholder approval and a formal valuation as would be otherwise required by MI 61-101 as the Company is listed on the TSX Venture Exchange and the fair market value of the transaction is far below 25% of the Company’s market capitalization.
CubicFarms to benefit from Artex’s end-to-end dealer support
In addition to the marketing and sales of HydroGreen systems, Artex Feed will further manage customer experience by providing installation services to purchasers of the systems, as well as training and troubleshooting. Artex is partnered with Fiske Electric, an established electrical contractor specializing in large commercial and agricultural projects for over 35 years, to help ensure smooth system installations.
John de Jonge, President of Artex Feed Solutions, commented: “The founders of Artex Feed are convinced that the technologies of vertical farming and controlled environment agriculture will significantly advance the productivity of livestock farming. All indicators show that the implementation of this technology is rapidly gaining traction, mirroring the advent of robotic milking around 30 years ago.
Artex Feed’s identified team is motivated to capture this market opportunity.”
Dave Dinesen, Chief Executive Officer of CubicFarms, commented: “Now that CubicFarms holds an interest of 50% in our reseller Artex Feed, we are better able to capture the value of sales of the HydroGreen systems. CubicFarms is proud to partner with John and Artex to advance their vision of “farm of the future” by providing a full range of leading edge, integrated feed production facilities, to help small-hold farms, family farms and commercial farms meet the long-term global demand for meat and dairy that is projected to rise, thanks to population growth and increasing incomes in emerging economies.”
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
About CubicFarm® Systems Corp.
CubicFarm® Systems Corp. (“CubicFarms”) is an ag-tech company providing automated growing systems for fresh produce and animal feed. CubicFarms offers turnkey, commercial scale, hydroponic, automated controlled-environment growing systems that can grow predictably and sustainably for 12 months of the year virtually anywhere on earth. CubicFarms enables its customers to grow locally and to provide their markets with safe, sustainable, secure and fresh ingredients that are consistent in colour, size, taste, nutrition and allows for a longer shelf life. Further support is provided to customers through the Company’s patent-pending germination technology and proprietary auto harvesting and processing methods. The Company has sold and installed systems in Canada and the US, and is currently negotiating with a global pipeline of prospective customers.
Cautionary statement on forward-looking information
Certain statements in this release constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws, including, without limitation, statements with respect to the development of the Artex Feed Solutions business and sales of the HydroGreen system. Such statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of CubicFarm Systems Corp. and its subsidiaries, or industry results, to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements or information. Such statements can be identified by the use of words such as “may”, “would”, “could”, “will”, “intend”, “expect”, “believe”, “plan”, “anticipate”, “estimate”, “scheduled”, “forecast”, “predict”, and other similar terminology, or state that certain actions, events, or results “may”, “could”, “would”, “might”, or “will” be taken, occur, or be achieved.
These statements reflect the company’s current expectations regarding future events, performance, and results and speak only as of the date of this news release. Consequently, there can be no assurances that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Except as required by securities disclosure laws and regulations applicable to the company, the company undertakes no obligation to update these forward-looking statements if the company’s expectations regarding future events, performance, or results change.