MMJ (ASX: MMJ) has grown its exposure to the medical cannabis sector after securing its first Australian medical cannabis investment via a 12.6% stake for A$600,000 in privately-owned Australian medical cannabis research start-up Martha Jane Medical Ltd.
Martha Jane Medical possesses an Australian medical cannabis research licence and is progressing other requisite medical cannabis licence applications as part of its plans to develop “high value” cannabis-based products and medicines for global markets.
“We are delighted to support Martha Jane Medical, our first Australian medical cannabis investment,” MMJ chief executive officer Jason Conroy said.
The start-up has a five-year memorandum of understanding with the University of Tasmania, where it can leverage the processes and expertise used from Tasmania’s opium poppy sector and apply them in developing proprietary cannabis extraction methods.
Harvest One Cannabis boosts cultivation
Additionally, MMJ’s partly-owned Harvest One Cannabis Inc (TSXV: HVT) has expanded its cultivation ground in Canada with a five-year lease agreement for a 59,000 square foot facility in British Columbia that will enable it to exceed its 8,000kg per annum cannabis cultivation target.
Harvest One’s wholly-owned subsidiary United Greeneries locked-in the new Aldergrove site after dropping its option on the Chemanius site which did not hold up during due diligence.
The Aldergrove site includes a 30,000sq ft building that will be used for cultivation. According to Harvest One, the facility only needs minimal alterations with construction pencilled in to begin before the end of August.
Harvest One claims the facility has expansion potential with more than 20 acres of land on the site.
Aldergrove also possesses requisite power and water to underpin expanded cultivation operations, plus it is close to major transport hubs and British Columbia’s provincial cannabis distribution centre.
The news follows MMJ’s announcement last week of it had sold its shareholding in Cannabis Wheaton Income Corp (TSXV: CBW) and e-Sense Lab (ASX: ESE).
“These divestments are in line with our strategy to recycle capital for further investments by MMJ in the global cannabis sector,” Mr Conroy said.
The sell-off in Cannabis Wheaton generated MMJ a 2.2x multiple on its invested capital and C$5.6 million (A$5.74 million) in cash for future investments.
Meanwhile, in its e-Sense divestment, MMJ achieved a small cash loss and walked away with A$200,000 in cash.