The Kanabo Group PLC (LON: KNB) share price was trading sideways despite announcing that its 40%-owned subsidiary Kanabo Agritec Ltd. has signed a contract with Taima Growth S.L.
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The contract is for developing an indoor medical cannabis cultivation and processing facility in Madrid, Spain. Kanabo Agritec provides consulting services around facility planning, design and implementation for the production of medical cannabis.
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Some of the services that Kanabo Agritec specialises in include the automation of irrigation and fertigation, choosing genetics, and optimising harvest through bespoke solutions and humidity control systems. The firm will offer all these services to Taima Growth.
On the other hand, Taime Growth is a special purpose vehicle (SPV) incorporated in 2019 that seeks to establish a network of facilities for cultivating and distributing medical-grade cannabis in Spain.
Taima has collaborated with Aurea Capital Partners, a Spanish investment firm focusing on renewable energy and sustainable agriculture, which is now invested in the project. Aurea Capital Partners has a proven track record of sustainable investments, recently selling its first investment in Spain to Goldman Sachs.
Kanabo Agritec currently owns 5% of the issued share capital of Taima, and its shareholding will be increased incrementally by an extra 15% based upon the achievement of specific milestones. The project will run in two stages, with Phase 1 expected to begin in the next few months and last 12 months.
After the completion of Phase 1, the Spanish Agency of Medicines and Medical Devices (AEMPS) will inspect the facility and grant a licence for the production and manufacturing of Cannabis and its products, subject to the successful passing of the inspection.
Avihu Tamir, Kanabo's CEO, commented: “Securing this agreement marks a pivotal step in Kanabo's roadmap. The high-quality supply chain that Agritec and Taima's partnership offers not only ensures access to premium materials but also promises to generate profits and enhance shareholder value for The Group. We're excited about this synergy and the immense potential it holds. We look forward to supporting Agritec and their work with Taima.”
*This is not investment advice.
Kanabo share price.
Kanabo shares were trading sideways despite today’s announcement as investors barely reacted to the news.
eToro is a multi-asset investment platform. The value of your investments may go up or down. Your capital is at risk.