Less than two months after entering a binding agreement to merge, Delic Holdings Corp. and Ketamine Wellness Centers Arizona LLC (KWC) have officially signed off on the transaction.
The closing of the deal between the psychedelic wellness providers was announced Tuesday, with KWC becoming a wholly-owned subsidiary of Delic for $10 million.
The purchase now makes Delic the largest psychedelic wellness provider in the United States, operating a total of 12 clinics across nine states.
“We are thrilled to officially welcome the KWC team to the Delic family and cement our place as the largest network of treatment clinics in the U.S.,” Delic CEO Matt Stang said in a press release regarding the merger.
Delic — whose corporate headquarters are outside of the U.S. in Vancouver — specializes in the drug ketamine, which is an intravenous alternative to traditional care methods used to treat various health conditions, including mental health conditions like depression, anxiety and post-traumatic stress disorder.
Ketamine was originally approved for use as an anesthetic in 1970 by the U.S. Food and Drug Administration. The U.S. Drug Enforcement Administration classified ketamine as a Schedule III drug in 1999, whereby it became a federally-controlled substance.
The merger gives Delic — which operates clinics in California and Arizona — a higher profile in the world’s $51 billion psychedelic wellness market. It also gives the provider access to KWC’s 10 ketamine infusion centers across Arizona, Colorado, Florida, Illinois, Minnesota, Nevada, Texas, Utah and Washington state.
Since its founding in 2011, KWC has provided over 60,000 treatments at its clinics. More than 60 KWC staff members will move over to Delic as part of the transaction.
KWC CEO Kevin Nicholson will also become Delic’s new chief operating officer.
“On behalf of the entire KWC team, we are very excited about officially becoming a part of the Delic family,” Nicholson said in the press release. “They are an industry leader and uphold the highest standards in developing new, science-backed medicines and treatments and making them more accessible to a wider group of people.”
Along with the newly-purchased KWC clinics, Delic is planning to open 15 more across the U.S. in the next 18 months. Some of those clinics will ostensibly retain the KWC brand, according to Nicholson.
“With the full support of Delic behind us, KWC will be on an accelerated path to growing our network of clinics throughout the U.S. and bringing more effective, affordable treatments to communities,” Nicholson added in the press release.
In September, Delic completed a private placement stock sale to an American institutional investor for $7 million in Canadian dollars (which was $5.63 million in American dollars, based on foreign exchange rates provided by CNN on Tuesday afternoon). At the time, the company cited its desire to increase its American presence as reason for the sale.
The company is listed on the Canadian Stock Exchange and is currently traded over-the-counter in the U.S.
In announcing the deal, Delic hinted at the possibility of expanding into other psychedelic wellness treatments like MDMA and psilocybin. Psilocybin has been decriminalized in a small number of cities as well as in Oregon, currently the only state where it is legalized.
Speaking to Behavioral Health Business last week for an upcoming feature story, Stang said that the company is looking to branch out into other psychedelic wellness treatments beyond ketamine.
“As MDMA and psilocybin and other novel compounds come down, they’re going to need special clinical places where people can come get treated with them,” Stang told BHB. “What we’re building is a large chain of specialty clinics that deal with psychedelic wellness.”
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