UK medical cannabis operator Kanabo Group has fallen into administration, seeing the last remaining member of the first four cannabis pioneers onto the London Stock Exchange face collapse.
On November 28, 2025, Kanabo announced that Damian Webb and Stephanie Sutton of RSM UK Restructuring Advisory LLP had been appointed as joint administrators, tasked with ‘assessing a range of strategic options aimed at returning the company to financial stability’.
Whether it can successfully emerge from its financial hole remains to be seen, but the administration itself represents a sobering end for a movement once hailed as the start of a revolution in the European cannabis industry.
When Kanabo launched its IPO in February 2021, becoming not only the second cannabis business in history to do so, but the second in just over a week, founder and CEO Avihu Tamir predicted that ‘within a couple of years, there may be as many as 50 cannabis companies trading on the exchange.’
Instead, four years on, all four companies from that initial 2021 wave have now either delisted, called in administrators, or abandoned the cannabis sector.
From rush to ruin
Between February and May 2021, four cannabis companies made their debut on the LSE in rapid succession, sparking a wave of excitement and investment in the fledgling European cannabis industry.
MGC Pharmaceuticals’ landmark listing on February 9, 2021, was closely followed by Kanabo just a week later, on February 16, with its shares nearly quadrupling over the first day of trading.
By May, CBD firm Cellular Goods, backed by high-profile names such as David Beckham, and early-stage biotech firm Oxford Cannabinoid Technologies had followed them onto the exchange.
These four oversubscribed IPOs in quick succession created what one executive described as an ‘absolute frenzy’ for cannabis stocks, in what many believed was the start of Europe’s own ‘Green Rush’.
Kanabo had initially approached the LSE seeking approval two years earlier, but at that time, the exchange simply had no mechanism to list cannabis companies. Following lengthy negotiations with the Financial Conduct Authority, the regulatory framework finally shifted in September 2020, allowing medical cannabis and CBD companies to list for the first time in the LSE’s 320-year history.
The rule change was seen as transformative. Spinnaker Chairman Andy Morrison, whose SPAC facilitated Kanabo’s reverse takeover, told Business of Cannabis at the time: “It’s been a long time coming. There have been lots of twists and turns, but they are all done. The door is open now.”
When it finally made it onto the exchange, its shares jumped from 4.75p to 20.5p, raising £6m in the process (double its £3m target), and achieving a market capitalisation of £23m.
The initial proposition centred on its VapePod, marketed as the first medically certified vaporiser for cannabis oils. By November 2021, Kanabo’s market cap had swelled to around £60m, buoyed by a planned £36m acquisition of Materia Ventures that Tamir said would position the company to become one of Europe’s ‘two or three’ cannabis unicorns.
Eight Years After Decriminalisation, South Africa’s Cannabis Industry Edges Towards Regulated Market
What goes up….
However, as with almost all of its publicly traded stablemates, the downward trend is just as abrupt, but much longer lasting.
The Materia deal collapsed in May 2022 as Kanabo’s market cap crashed to £16.5m. Kanabo subsequently pursued several strategic pivots, moving away from cultivation and production towards ‘last mile assets’ and a service model.
Kanabo acquired Telemedicine provider The GP Service for £14m the same year, and by 2023, it had effectively transformed from a medical device manufacturer into a digital health operator, launching the ‘Treat It’ online clinic in March 2023 and expanding into mental health services by April 2024. The company even opened physical walk-in pharmacies in London and Manchester.
As late as March 2025, Kanabo was publishing optimistic trading updates. The company reported 44% revenue growth for 2024 to £1.3m, though it remained loss-making with an EBITDA loss of £1.9m. Monthly revenue in January 2025 had reportedly surged 406% year-on-year to £76,842.
The company touted AI integration across its operations and an investment in a Spanish cultivation project that promised an additional £1m in revenue for 2025.
Yet, this optimism was short-lived. On April 04, 2025, Kanabo warned that its ‘financial position has become more uncertain over the past month’, and announced it was in discussions regarding potential restructuring. Three days later, the company’s auditor resigned. By May 1, trading was suspended at Kanabo’s own request.
The suspension lasted nearly seven months before the administration announcement.
The broader pattern
Kanabo’s troubles mirror the fate of its 2021 peers. MGC Pharmaceuticals, the very first cannabis company to list on the LSE in February 2021, rebranded as Argent BioPharma in January 2024 before delisting from the exchange on December 31, 2024, maintaining listings on the Australian Securities Exchange and OTCQB Venture Market instead.
Cellular Goods largely abandoned its CBD play, rebranding as Cel AI in January 2024 to focus on AI-powered beauty recommendations. The company had generated just £67,236 in revenue for the year ending August 2023 against losses of £3.3m.
Oxford Cannabinoid Technologies followed the most dramatic trajectory. The pre-revenue biotech voluntarily delisted in June 2024 after its share price fell 97%, hoping to access greater capital from private investors.
Less than a year later, in May 2025, OCT entered administration, its drug development pipeline and intellectual property now in the hands of administrators.
What went wrong
This collective failure is more to do with systemic hurdles than individual mismanagement, though not entirely.
The regulatory burden proved far heavier than anticipated, with the FCA imposing new requirements in 2021 that forced companies to obtain legal opinions from every territory they operated in. The minimum market capitalisation threshold was also raised significantly, leaving many hopefuls out of IPO contention.
More fundamentally, institutional investment never materialised. The companies remained largely dependent on retail investors, creating extreme volatility and limiting access to sustained capital. Cannabis stocks globally faced a sustained downturn, with market sentiment undergoing what one executive described as a ‘complete 180 shift’ from the euphoria of early 2021.
Despite Kanabo’s agility and efforts to diversify its offering, becoming one of the first cannabis-first players to expand into general healthcare, its failure to turn a profit in a financial environment stacked against cannabis operators has left it on the precipice.
