Listed technology and logistics holding company Labat is getting into the cannabis business.
The company, which has been listed for 25 years, has acquired 70% of a seeds and genetics business known as Knuckle Genetics, which produces “high-quality cannabis flower, oils and concentrates with a very high (more than 20%) THC content for the export market”. The deal is worth R4-million.
At the same time, it has acquired a licence to “cultivate, manufacture, supply, hold, import, export and transit cannabis in the Kingdom of Lesotho”. Further details about this will be “announced in due course”.
Labat has also acquired a South African Health Products Regulatory Authority-approved pharmaceutical facility — Pac-con Pharmaceuticals — which “manufactures and packages liquids, tablets, capsules, creams and gels”.
“Pac-con will be utilised to produce high-grade CBD oils and related cannabis products for the retail and wholesale markets,” Labat said in a statement to shareholders. The cash-and-share deal is worth R10-million.
Labat is headed by CEO Brian van Rooyen, a former rugby player and administrator.
Together, the deals will “give effect to the establishment of a fully integrated cannabis business within the Labat group of companies”, the company said.
“Labat has, as part of its long-term strategy, invested over the years an enormous amount of time and resources in investigating opportunities in the pharmaceutical sector, including investigating the establishment of an active pharmaceutical ingredient (“API”) facility in Pretoria,” it said.
The deals will “assist Labat in its quest to become a major player in the cannabis industry, which is currently highly regulated in South Africa but more deregulated in countries like Lesotho and Zimbabwe”.
The company has hired Mike Stringer, a former MD of an API facility in Cape Town, as CEO of the cannabis operation, which will be called Labat Cannabis.
“Mike has worked for thirty years in the API industry and the last five years as CEO of a large API facility,” Labat said. “He was key in developing the US and EU markets together with highly competent agents.” — © 2019 NewsCentral Media