MMJ Phytotech is doubling down in Canada with an investment in a little-known North American cannabis business.
The Australian medical marijuana company (ASX:MMJ) is to invest $C2.5 million ($2.5 million) into Dosecann via convertible debenture notes, a type of debt that isn’t backed by physical assets.
MMJ shares were up 6 per cent to 53.5c on Monday morning.
Dosecann was incorporated in December 2016 but there is little information available as to what it does. (Stockhead has contacted the VP of corporate development, Michael Curtis, for comment).
It has signed deals with cannabis-grower Emblem Corp and Delivra to develop cannabis formulations with accurate dosages.
Dosecann is not a licensed dealer in Canada, which would allow it to import and export cannabis in any form. But MMJ Phytotech says there’s a possibility it will become one.
It’s applying for a producer licence.
Dosecann is planning to build a large pharmaceutical factory, with phase one proposed to be finished by the end of June.
MMJ Phytotech managing director Andreas Gedeon says the Dosecann management team and its “aggressive expansion plans” could create a lot of value for shareholders.
“A key focus of the board has been to solidify MMJ’s exposure to the rapidly maturing Canadian cannabis sector and we believe this investment in Dosecann, coupled with our existing holding in Harvest One, is a significant step towards achieving this objective.”
MMJ owns 59 per cent of Canadian grower Harvest One.
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