European cannabis stocks had another generally positive week last week, with some major announcements from the North American market prop-up gains across the continent.
Mid-week news broke of Cresco Labs upcoming $2bn acquisition of Columbia Care, a landmark deal which could see significant US cannabis-capital flow into Europe via the latter’s international operations.
On Thursday NASDAQ listed stocks rallied following reports that the US House of Representatives scheduled a vote on whether to remove cannabis from the list of federally controlled substances, a potentially major step forward in the journey to federal legalisation.
While stocks listed on German and Israeli stock exchanges performed well this week, London Stock Exchange listed companies had a more difficult few days.
Board Changes at Kanabo and Cellular Goods
Early in the week Kanabo announced that the current Audit Committee chair and Non-Executive Director Uzi Danino would be retiring ‘to focus on other business interests’.
Effective from March 31, President and Chief Financial Officer dual-listed firm Purple Biotech Gil Efron will take Uzi’s place on Kanabo’s Board.
Kanabo’s CEO Avihu Tamir said that Mr Efron’s ‘wealth of experience in the capital market will be an excellent addition’, fuelling speculation among investors that Kanabo could be targeting a dual listing or further capital raise.
Days later Kanabo announced the launch of an ecommerce platform in the UK, selling its range of CBD products.
While the market’s reaction to developments at Kanabo remained fairly muted, Cellular Goods endured a tougher week, seeing its stock drop over 10%.
Cellular Goods informed investors that its Chief Operating Officer and Director Eric Chang will be departing the company on April 15th, and that another COO will not be appointed as a replacement.
Instead it has created a new role, Chief Supply Chain Officer, to which Deloitte and Procter & Gamble veteran Nikil Vijayan has been appointed.
The company said: “His expertise will not only ensure that we can continue delivering high-quality products to our customers, but it will also be key to the successful launch of new products this year and beyond.”
Investors were less optimistic about the appointment, raising concerns about the turnover of high-profile staff at the company, following the appointment of a new CEO in December.
By far the biggest rise this week was Panaxia, marking a dramatic turnaround from a 13% drop in the prior week.
On March 15 international cannabis operator IM Cannabis, which has a market cap of around CAD$170m, announced the completion of three acquisitions it announced in 2021.
Alongside the acquisition of fellow Israeli companies Vironna and Pharm Yarok, IM Cannabis closed the second stage of its deal with Panaxia, first announced in April 2021, seeing it acquire Panaxia’s trading house and in-house pharmacy activities.
IM Cannabis has now received received IMCU approval to acquire an IMC-GDP licence for distribution of medical cannabis from Panaxia
The $7.2 cash injection from the deal will be good news for Panaxia’s investors, who’ve seen the company’s mounting debt pile drag down its stock price.
Akanda’s stock continued to perform well following its debut on the NASDAQ earlier this month.
Aside from the wider rallies seen throughout exchange following the news of progress on federal legalisation at the end of the week, Akanda’s stock rallied on Monday.
It came after Halo Collective, Akanda’s majority shareholder, announced the opening of its first Budega dispensary in Los Angeles, the first of three it plans to open.
This could provide a potential major source for the pre-revenue company, which cultivates cannabis at a facility in Lesotho, Southern Africa, should Halo decide to begin selling its produce.