JOHANNESBURG - CanbiGold, a Cape Town based company, has negotiated a direct foreign investment deal with an American Investment company for R1 billion over five years as it unlocks the investment prospects that the medicinal cannabis industry has to offer.
Their investment will pay for 100 modular fortresses to be built and operated at CanbiGold’s Lesotho site near Maseru which is a R600 million investment, as was reported in the media, subsequently CanbiGold has been informed that these fortresses need to be upgraded to super fortresses which now takes this investment past the R1 billion mark.
The deal was negotiated at the cannabis expo at Sandton in November between Koomo Capital and Canngea, an Australian company that has entered into an off-take agreement of the dried flower produced in the modular units which will be built and operated for Koomo Capital by CanbiGold.
“The initial deal was for only 20 units as Koomo Capital thought the European market was fairly limited. Now, however, with Canngea’s new off-take agreement the investment has increased to 100 super fortresses at a cost of R10 million each,” Leon van der Linde, CEO of CanbiGold said.
The investment will further boost the regular cannabis industry in South Africa as provincial economic development agencies in the Eastern Cape and KwaZulu-Natal see the industry as a way of boosting employment. The direct foreign investment will also go hand in hand with the roll out of cannabidiol (CBD) products that CanbiGold has designed and patented.
Canngea’s Australian facility will extract the CBD and Tetrahydrocannabinol (THC) from the flower and manufacture white label products that they intend to distribute in Australia, the European Union (EU),the United States (US) and Canada, also for CanbiGold Asia which is scheduled to expand into the Asian market in 2021.
“We have a high tech 11 000 square meter facility in Australia that has GMP (Good Manufacturing Practices) and TGA (Therapeutic Goods Administration) approvals. That means we can meet the requirements for export to USA, Canada and the EU,” Martin Bryden, the CCO at Canngea said.
“We are a business-to-business (B2B) company that develops engineered cannabis strains with specific CBD to THC ratios embedded into their DNA, for a variety of medicinal products. The designer cannabis’ clones are then grown, extracted and manufactured into products for our clients. Our facility also has everything needed to meet the labelling and packaging requirements in order to distribute in the EU, Australia, USA and Canada,” Bryden added.
FILE - In this Aug. 15, 2019, file photo, marijuana grows at an indoor cannabis farm in Gardena, Calif. (AP Photo/Richard Vogel, File)
CanbiGold will be building a nursery that will grow designer clones for Canngea at their Maseru location. The nursery will provide clones for the fortresses and the flowers will then
be exported to Australia for extractions. These fortress units are flatpack modular structures that can be assembled and disassembled on their site. The plants are grown under special LED lights and in hydroponic trays, which is an efficient way of saving water. CanbiGold will further invest in the entire value chain of cannabis cultivation from the HOCL for which they are building a new facility to ensure organic production of cannabis, to fertilizers and a plant for the extraction of CBD and THC for their own vapes and edibles.
CanbiGold plans to grow medicinal cannabis at several sites in Lesotho and they are expanding their operation into Gauteng where they will be opening an office in Sandton to oversee and coordinate their operations. In March next year a site in Benoni, South of Johannesburg, will start operating with a new cultivation licence in a joint venture with Dr
Mike Renda. Dr Renda and CanbiGold will use this facility as a research and development (R&D) centre that will research how to optimize the yield of the plants. The methodologies development at the Benoni site will be deployed at their other operations to improve the yield of all the modular units that CanbiGold will be operating. This will be coupled with a partnership with the Michigan University in the US to do further R&D on cannabis cultivation. Meanwhile CangiGold’s R&D is already starting to pay off as they have secured a worldwide patent on CBD infused tampons, which are planned for the retail market in Australia and the USA during 2021.
“CanbiGold and FoxyPink decided on a joint venture to manufacture CBD-infused tampons which are completely natural and contain no plastic with carcinogenic dioxin. They are imported from Israel and the CBD is injected into the inner core and when the tampon encounters bodily fluids, it pops and is then passively ready for absorption. These tampons are specially prepared to help relieve menstrual pain, cramps, back ache as well as helping with depression during this time,” Van der Linde concluded.