Vaswani to remain head of Kaya after sale to Silo

Businessman Balram ‘Bali” Vaswani will remain at the helm of Kaya ganja stores in Jamaica after the merger with Canadian magic mushroom firm Silo Wellness.

“I’ve been asked to serve as CEO and chairman,” Vaswani confirmed. “My focus is still on weed and mushrooms.”

The merger transaction is set to conclude in the fourth quarter of this year. As part of the deal, Silo Wellness will undergo a name change to Kaya Wellness upon acquiring Kaya Group.

Kaya Group is held by American company NUGL Inc.

Last August, Silo announced its intention to acquire “100 per cent of NUGL’s shares” in a transaction valued at CDN$43.2 million. While the transaction was initially scheduled for completion in June, Vaswani now anticipates that it will be finalised by December.

Vaswani, who holds the largest stake in NUGL, at 22 per cent, will retain influence at the board level even after Silo acquires all the shares.

“Silo will handle the necessary listing documents and regulatory submissions. The new board will comprise two members from Kaya, one from Silo, and two independent directors,” Vaswani explained.

It remains uncertain whether Vaswani will receive shares in Silo Wellness post-acquisition.

Silo Wellness is already present in the Jamaican market as operator of magic mushroom retreats. The Canadian company reported negative shareholder equity of US$1.7 million back in July 2023.

Kaya, which operates four herb houses, generated approximately US$600,000 in first-quarter sales, up from US$550,000 the previous year, resulting in a profit of US$27,000 compared to prior-year losses of US$150,000.

Due to its historic losses and negative cash flows, Kaya reported accumulated deficit of US$8.6 million and a working capital deficit of US$885,000 at year end 2023. The company has relied heavily on debt and equity financing for its operations.

Jamaica’s legal ganja market boasts 133 licensed operators as of December 2023, according to disclosures from the Cannabis Licensing Authority.

Established in 2015, Kaya was the first to market with retail ganja stores when the Jamaican Government legalised the sale of medical marijuana. It now operates four herb houses and five subsidiaries, namely, Jamaica Ganja Corporation Limited, The Herb Company Limited, Kaya LLC Jamaica, Island Kaya Limited, and Kaya Extracts Limited.

In 2022, Kaya merged with US-based NUGL Inc in a reverse takeover, making Vaswani the largest shareholder in NUGL.

The shares of both Silo and NUGL trade over-the-counter via broker-dealers, with Silo additionally listed on the Canadian Securities Exchange and the Frankfurt Stock Exchange.

steven.jackson@gleanerjm.com