Cann Group executes Share Sale Agreement to acquire Satipharm
~Cann Group has agreed to acquire the Satipharm business from Harvest One Cannabis Inc in an all-scrip deal involving a total maximum consideration of CAD$4 million (including conditional deferred consideration of up to CAD$1.5 million)
~ Satipharm is a Europe-based business exclusively licensed to develop and market the proprietary Gelpell® delivery system for cannabinoids
~The proposed acquisition, when completed, will give Cann an immediate position in the rapidly growing low dose CBD market segment and will fast track development of new, novel THC based medicinal cannabis formulations
~ Cann plans to proceed with a TGA submission to have CBD Gelpell® capsules approved for sale in Australia, following the implementation this month of regulatory changes which enable low dose CBD products to be sold by pharmacies on an over-the-counter basis
~ The Satipharm business includes existing commercial supply agreements with retail channels in United Kingdom, Ireland and Eastern Europe
~ Satipharm is expected to generate ~$1m in revenue for the six months to 30 June 2021, with a material ramp up in sales anticipated thereafter
• Gelpell® pharmaceutical GMP manufacturing line to be installed in Cann’s new Mildura production facility
• Acquisition is expected to accelerate revenues, expand market access and strengthen product pipeline
• Acquisition structure includes the issue of new Cann shares to the value of CAD$2.5 million at completion; and deferred consideration of up to CAD$1.5 million based on achieving agreed operational and financial resultsto be paid in new Cann shares or cash, at Cann’s election
Cann Group revises revenue guidance for FY21
15 February 2021 – Cann Group Limited (ASX: CAN) (Cann or the Company) today advised that COVID19 related regulatory delays have necessitated an adjustment of revenue guidance for the current financial year. The adjustment follows a management-Board review – completed over the weekend - as part of the Company’s preparation of its half-yearly report, which will be released next week. The revised forecast reflects an update to the expected timing of revenue, with revenue originally forecast to be recognised this financial year now expected to be recognised in the first half of financial year 2022. The Company is now forecasting revenues of between $8 million and $10 million (previously $15 million), with the revised guidance subject to relevant regulatory clearances being secured.The Company’s previous revenue guidance assumed sales of Cann medicinal cannabis products to customers in Australia and in overseas markets, particularly the UK and Germany.
Substantial delays have been incurred in relation to obtaining required regulatory approvals both in Australia and in Germany, with the authorities involved impacted by COVID-19 priorities and resource constraints.
Cann Group advises of cyber security incident
8 February 2021 – Cann Group Limited (ASX: CAN) (Cann or the Company) advises that it has experienced a cyber security incident, involving an unknown third party. The breach was discovered overnight on 4 February 2021 and is currently under investigation
The Company has recently made payments of approximately A$3.6 million to an overseas contractor (in relation to works being undertaken for Cann’s Mildura facility), however those payments have been received by an unknown third party as a result of a complex and sophisticated cyber fraud perpetrated against the Company and its overseas contractor. The Company is working with its bank to determine if any of the payments can be halted and if any of the funds involved are recoverable. The Company has notified its insurance brokers to determine if a claim can be made to recover any of the losses involved. Immediate action has also been taken to ensure the integrity of Cann’s IT systems.
The Company is in a financial position to continue with its ongoing operations and projects, including the construction of its Mildura facility, irrespective of any funds being recovered.
The Company and its overseas contractor are investigating the incident thoroughly, including the engagement of external security and forensic IT experts to assist. The matter has been reported to police in Victoria, Australia, the Netherlands and Hong Kong, as well as the Office of Drug Control. Further updates will be provided in due course as the investigation proceeds.
A warning to us all !
This could be one of those stcks that could do up 10 fold