Kanabo has signed a Memorandum of Understanding (MoU) for an indoor medical cannabis cultivation project in Spain.
The facility will enable 4,000kg per annum indoor cultivation and processing of cannabis. The facility, which is to be established in Madrid, Spain, will focus exclusively on medical cannabis.
Kanabo Group has formed an Israeli subsidiary company, Kanabo Agritec Ltd. (Agritec), which Kanabo Research Ltd, a wholly owned subsidiary of Kanabo Group, holds a 40 per cent shareholding, together with certain additional control rights over the strategic direction of the subsidiary.
Kanabo Agritec will enter into agreements with customers to offer consulting advice and support on cultivation, processing and production of medical cannabis products to organisations and entrepreneurs entering or already active in the cannabis market.
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CEO of Kanabo Group, Avihu Tamir, commented: “We are truly excited by today’s announcement. Agritec provides Kanabo Group plc an opportunity to realise the value of our extensive, existing intellectual capital in medical Cannabis cultivation and production, providing near-term consulting revenues.
“Secondly, it provides us a way to diversify, secure and quality control our supply of medical-grade Cannabis that will always meet our exacting standards, avoiding any wasted margin from product that does not meet the grade.
“In short, the new venture provides all the benefits and value of owning the cultivation supply chain, without the Capex and Opex requirement of building a cultivation operation ourselves. Furthermore, Kanabo consumers will be guaranteed a consistent, highest quality supply of medical Cannabis products, at all times.”
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CEO of Agritec, Ophir Shimshi, commented: “We are excited to combine Agritec’s team experience with Kanabo’s extensive R&D knowledge and expertise, to bring this powerful, full-service consultancy offering to market.
“Agritec’s clients will benefit from Kanabo’s immensely valuable, tried, tested and proven playbook.
“Our range of consulting services deliver every strategic and operational consideration required by enterprises and entrepreneurs who wish to take advantage of the immense growth opportunities this market has to offer.”
Kanabo has stated that Agritec provides the company with complementary near-term revenue opportunities and will offer Kanabo improved security of cannabis supply through a diverse range of suppliers, who will all adopt Kanabo’s high-quality manufacturing standards without Kanabo having to fund or become directly involved in cannabis cultivation.
Agritec customers will benefit from Kanabo’s services including: procurement, design and build of commercial scale, medical cannabis cultivation facilities; high-quality genetics and standard operating procedures for optimal medical cannabis cultivation; post-harvest services including offtake agreements with Kanabo Group; design and draft reporting and documentation filing services with the local authorities; and, local training and ongoing consulting services.
As per the terms of the MoU, Agritec may elect to receive up to 20 per cent ownership of the project based on the achievement of agreed milestones.
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