Israeli cannabis cultivation company InterCure Ltd. (TASE: INCR-L), which today led a session on cannabis at the World Economic Forum in Davos, has unveiled several activities and new deals at the conference: a joint venture to manufacture medical cannabis products in Canada, a partnership with a European corporation that already has a license to grow cannabis in Europe, and a partnership with an Israeli concern for building a cannabis growing facility that will be substantially larger than the company's current facility in northern Israel.
Following the announcements and in anticipation of possible Israeli cabinet approval of cannabis exports on Sunday, InterCure's share price is up 16% today and 57% since the beginning of the week. The company's market cap is now NIS 686 million, following a 1,700% rise in its share price over the past year, while its annual revenue amounts to only a few million shekels.
The chairman of InterCure is former Prime Minister Ehud Barak, who has already brought the company an important investor, Gary Fegel. Fegel led a $12 million financing round by the company. Barak is the company representative at international conferences like Davos.
InterCure hired Barak in October 2018 in a part-time job of 40 hours a month with a $10,000 monthly salary, plus options for 5% of the company's shares at a NIS 3.20 strike price per share. InterCure's current share price is 160% higher than the strike price, meaning that Barak has earned NIS 21 million on paper.
Target: 100 tons of cannabis
The three activities reported today are part of the company's strategy for setting up cannabis ventures in Israel and overseas and reaching a production capacity of 100 tons of cannabis. InterCure's overseas ventures are based on the know-how of Canndoc, which has been active in the Israeli cannabis market for over eight years, albeit on a small scale, and on combining this knowledge with activities that in many cases have already begun, and in which money has already been invested in foreign countries.
InterCure's cannabis growing facility in northern Israel already has GMP certification, which enables the company to apply for an export license once exports are approved by the government. The option of exporting from Israel will not change InterCure's plans to continue developing its overseas business. Nevertheless, it is possible that the company will export cannabis to the same countries where its operates locally, because growing cannabis in Israel is cheaper, and the type of products coming from each country is likely to be different.
Published by Globes, Israel business news - en.globes.co.il - on January 24, 2019
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