Medicanja not giving up on IPO

Medicanja not giving up on IPO

Plans for possible cross-listing like its competitor TOKI

Observer business writer

Friday, February 28, 2020

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Jamaica's first registered medical cannabis company, Medicanja, is pushing to get its initial public offer (IPO) off the ground later this year, an effort that has been in the works for three years.

Medicanja CEO Dr Henry Lowe told the Jamaica Observer that his dream of an IPO is more than possible for 2020, while pointing to issues that have prevented the company going to the equities market for capital. He said those issues still remain, in particular the hands-off approach of the banking sector in doing business with cannabis companies, citing de-risking concerns.

Dr Lowe pointed to the millions of dollars spent by Medicanja in preparing for the IPO only to have it scaled back because of fear by distributors and business partners that their banks would deem their business too risky to handle given their association with a cannabis company.

While admitting that he has never lost interest in going to the equities market in Jamaica, Dr Lowe said that he has had renewed interest in pushing forward with the IPO given a Sunday Finance article last month about Tree of Knowledge International Corp, which trades under the name TOKI.

Sunday Finance reported that TOKI will not just become the first company to be cross-listed on the Jamaica and Canada stock exchanges, but will also become the first medical cannabis company to be listed on the Jamaica Stock Exchange (JSE).

In response to the article, Lowe remarked, “I am very, very interested in going to market. In fact, since this article came out I have had at least 14 people call up on that Sunday saying how you let the Canadians beat you to go to market in Jamaica.”

He conceded that TOKI's listing in Jamaica will have some implications for his company, which is pushing forward with its IPO, having spent a lot of money spent on preparatory work for the IPO.

Making reference to the planned IPO three years ago Lowe contended, “We were assured by everybody and suddenly the big axe came down on us because of the banking industry issue,” the Medicanja CEO recalled.

Confessing that his IPO plan was in cold storage, Dr Lowe told the Caribbean Business Report that it is now being put back on the front burner. He admitted that a lot of activities are now taking place in the medical cannabis, world and in Jamaica, in particular cannabis work that is now taking place in Jamaica, which would cause the banks to be more business-friendly regarding banking relationships with companies like his that are in the business of producing medical cannabis products.

He expressed the hope that from the publication of this article those businesses, such as the banks, which would have been hesitant about doing business with his cannabis companies such as his would have now had a change of heart.

Medicanja has developed 30 cannabis products of which 12 have reportedly been approved by the Ministry of Health, and which can be exported. “As soon as the export facility opens we are gonna go there so you see we are poised and ready,” Dr Lowe declared.

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