Subversive Acquisition LP (OTCQX: SBVRF) gave the market an update on its qualifying transaction (QT) to combine with Israeli-based InterCure Ltd. (dba Canndoc) (TASE: INCR). Subversive believes the deal will close on April 8, 2021.
InterCure is the first public company on the Tel Aviv Stock Exchange to hold a valid and permanent license for the medical cannabis value chain through its 100% ownership in Canndoc. Canndoc is a GMP medical cannabis producer and was licensed by the Israeli Ministry of Health in 2008. It is a leading pioneer in the research, cultivation, production, and distribution of pharma-grade cannabis-based products to patients, hospitals, pharmacies, research, and governmental organizations. Through its strategic exclusive collaboration with world leaders, distribution agreement with SLE (100% owned by Teva Pharmaceutical Industry), and long-term sales agreements, Canndoc is well-positioned as a leading and significant player in pharma-grade medical cannabis in Israel, Europe, and the United Kingdom.
Previously, Subversive had said that InterCure’s expected EBITDA in the fourth quarter of 2020 had annualized run rate of greater than US$10 million and positive free cash flow. Its revenue grew more than 13 times compared to the fourth quarter in 2019 and more than three times compared to InterCure’s annual revenue in 2019. Subversive said that the fourth-quarter growth in revenue and profitability did not include the new operations acquired in January 2021 and commercialization of InterCure’s southern facility, the largest and most advanced in Israel, which occurred in 2021.
The company’s share of the medical cannabis market grew 40% in 2020 and that it was the first company to import medical-grade cannabis to Israel; It is also positioned to capitalize on the legalization of recreational cannabis.
Subversive said it will hold a special meeting of its unitholders on April 6, 2021, to get the approval of a special resolution to consummate the Qualifying Transaction. The company also said it will try to get an extension for the date of the transaction if everything isn’t in place.