Prominent Canada-based cannabis company IM Cannabis acquired three new marijuana companies based in Israel; R.A. Yarok Pharm Ltd., also called Pharm Yarok, Rosen High Way Ltd., and High Way Shinua Ltd. The deal is valued at around C$4.6 million (roughly $3.6 million USD), with the acquisition expecting to integrate assets that include a license to sell medical cannabis to patients with the ability to sell online.
The acquisition also equips them with a large customer service center, a virtual store, online properties, intellectual property, logistics, and a warehousing center with specialized storage space for over 350 kg of medical cannabis along with a large customer base. This move can make IM one of the biggest companies for cannabis supplies.
IM Cannabis said it expects to be able to consolidate the financial results of R.A. Yarok Pharm Ltd. and HW Shinua as of the date of executing the definitive share purchase agreements and before closing. Oren Shuster, CEO of IMC said, “The Israeli cannabis market continues to grow and evolve very rapidly. Pharm Yarok is one of the leading medical cannabis retailers in Israel, selling approximately 1,000 kg of medical cannabis per year and serving over 2,000 patients per month.” He continued by saying that, “The Acquisition significantly advances our retail expansion strategy, initiated earlier this year through the acquisition of Panaxia-to-the-Home’s distribution and in-house pharmacy activities.”
Shuster concluded, “We expect that the continuation of our vertical integration strategy will increase our purchasing power with suppliers, create potential synergies with our established call center and online operations and provide for additional margin on direct sales and up-sells across a growing range of products. We welcome the Pharm Yarok and Rosen High Way management teams and employees, along with their experience in retailing and branding.”
Pharm Yarok is one of the leading medical cannabis pharmacies located in central Israel. The cannabis business serves more than 2,000 medical cannabis patients per month. They’re located in Netanya, a city in central Israel, and have been taking care of patients since June 2020. Rosen High Way is a trade and distribution center providing medical cannabis storage, distribution services, and logistics solutions for cannabis companies and pharmacies in Israel. HW Shinua is an applicant for a medical cannabis transportation license from the Israeli Medical Cannabis Unit.
If the license is received, it enables HW Shinua to transport mass quantities of medical cannabis to and from Pharm Yarok’s pharmacy and Rosen High Way’s distribution center, and from third-party medical cannabis sectors across Israel. The transaction sits at approximately $4.6 million in cash, of which $1.3 million shall be invested in IM Cannabis in consideration for IM Cannabis’ equity by the shareholders of the acquired companies. With this business move, cannabis will start to become a lucrative financial avenue for years to come.