GOVT DISPUTES AWARDING DAGGA LICENCES

MBABANE – The country has not promised anyone a licence for cannabis and industrial hemp production.

This was said by the Minister of Commerce, Industry and Trade, Manqoba Khumalo. This is despite claims by two big players in the cannabis industry that they have a partnership with the country on the cultivation of cannabis for medicinal and industrial use.

The companies are Profile Solutions Inc and Stem Holdings. The press release on the partnership with the country was even published by Nasdaq, which according to www.wikipedia.com, is an American Stock Exchange.

It is said to be the second-largest stock exchange in the world by market capitalisation, behind only the New York Stock Exchange and both are located in the same city.

In the latest release, it was stated that Stem Holdings, Inc. was pleased to announce that it had executed a definitive agreement dated March 22, 2019 to acquire South African Ventures, Inc. (SAV). SAV was said to have a joint venture (JV) with Profile Solutions, Inc. (PSIQ) and a working capital surplus of approximately E120.7 million (US$8.27 million).

The JV, it was claimed, had received preliminary approval to become the only licensed growing farm and processing plant for medical cannabis and industrial hemp in the Kingdom of Eswatini for a minimum of 10 years.

E78m facility construction

The release stated that Stem expected that the JV would finance the cost of construction of the facility, estimated at E78 million (US$5.26 million), with the JV’s cash-on-hand and other non-dilutive sources of financing.
“Stem expects that the construction of the facility will begin during the second quarter of 2019 and be finished during the fourth quarter of 2019,” the press release stated.

It was stated that upon issuance of related permits and the construction of the facility, the JV would operate an advanced hemp and medical cannabis manufacturing facility to grow and cultivate cannabis in accordance with strict Good Manufacturing Practices (GMP) global health standards.

The JV, according to the claims, would also distribute hemp and medical cannabis within Eswatini, be the exclusive exporter within Eswatini for hemp and medical cannabis worldwide, operate a medical cannabis research and develop a laboratory and build a training facility to create jobs for Eswatini citizens.
Adam Berk, CEO of Stem, reportedly stated that they were very excited to expand their cannabis and industrial hemp operations globally through their partnership with the Kingdom of Eswatini.

“Products produced at the Eswatini facility will initially be available for export to countries including but not limited to Australia and the European Union,” he is reported to have said.

He reportedly stated that with the experience and success they had accomplished to date growing, cultivating, processing, extracting and distributing hemp and medical cannabis in the United States, the venture in Eswatini would be potentially accretive for their shareholders and rewarding for the country’s citizens.

Royal Science and Technology Park connection
The companies claimed that the Eswatini facility would be located on 2 500 acres (1 011.7 hectares) at the Royal Science and Technology Park for cannabis and industrial hemp cultivation. Worth noting is that this would be equivalent to over 1 000 soccer fields.

 It was stated that the facility would adhere to strict GMP processing, including a state-of-the-art research and development lab focused on genetic propagation. “The implementation of this project is expected to have a positive impact on this incredible Southern African country by bringing new jobs and new infrastructure,” the press release stated.

It was further stated that the Eswatini facility had the potential to produce over 12 000 kilogrammes of product on an annual basis. “Stem expects production from the facility to begin during the fourth quarter of 2019,” the press release stated.

It was also declared that unlike many other cannabis businesses and opportunities, the JV had already secured access to water rights, electricity, and banking for the project. “All security plans and operations for the Eswatini facility will be developed and managed by Golan Maimon, former Israeli Chief of Military police from 2013 to 2016,” the press release stated.

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