Medicinal cannabis manufacturer Cannasouth has cancelled its plan to buy out Cannasouth Cultivation after its capital raising fell short of the target.
Photo: IGOR STEVANOVIC / SCIENCE PHOTO LIBRARY
The company raised a total of $4.7 million through the issue of 11,750,000 new fully paid ordinary shares and 3,917,149 options, but that was less than the $6m necessary to meet the conditions of the offer to buy the other half of Cannasouth Cultivation (CCL) it does not already own.
Cannasouth chair Tony Ho said the condition of the agreement was not satisfied and the deal to buy CCL had been terminated.
"We are pleased with the positive support we have received from shareholders and investors, given the current environment, to have successfully raised $4.7m of our targeted $6m raise," he said, adding the company was in discussions with its CCL's joint venture partner about other options to buy the outstanding 50 percent.
However, Ho said the company had managed to buy the outstanding 40 percent stake in Midwest Pharmaceuticals and was in a position to invest more in product development.