Grace Ossongo – Yaounde, Cameroon
As Africa’s first cannabis-targeted special purpose acquisition company, or SPAC, Cilo Cybin Holdings has been given permission to list on the Johannesburg Stock Exchange.
Through an IPO that will not be open until November, the company hopes to raise $115 million for the production of medicinal cannabis.
Cilo Cybin Holdings, founded by businessman Gabriel Theron, is anticipated to attract a lot of interest from investors as South Africa’s developing cannabis industry makes a crucial step toward entering a much-anticipated worldwide market forecast to be worth $27 billion in 2022.
Theron states that the first action taken under the proposal will be to buy an existing cannabis manufacturing plant and increase its capacity with the funds raised.
“We want to establish ourselves as one of the major processing centers for the African cannabis market.”Gabriel Theron
Theron predicts that the worldwide legal cannabis market will be worth $51 billion by 2025, and that the businesses that build strong brands early in the race will be the ones that survive in this highly regulated and convoluted but profitable market.
“Medical marijuana is used to treat a variety of long-term diseases, including Parkinson’s disease, Alzheimer’s disease, arthritis, cancer, depression, anxiety, epilepsy, and other neurological disorders.
The need for products to treat numerous chronic illnesses has therefore expanded as a result of a broad application scope, according to him. SPACs are created to either purchase or merge with an existing business or to raise cash through an IPO.
The listing of Cilo Cybin is the first for a cannabis-specific SPAC and only the fourth SPAC on the continent overall.
President Cyril Ramaphosa praised “the immense potential for investment and employment development” of a legal cannabis business in his annual State of the Nation Address in February. Ramaphosa put the industry’s potential domestic value at $1.6 billions and was enthused about the advantages of legalizing marijuana; the WTO believes that South Africans already grow 2,500 tons of the crop year, albeit primarily illegally.
According to Ramaphosa, the hemp and cannabis industries have the potential to add more than 130,000 new employment. So that the hemp and cannabis industries can prosper like they do in other nations like Lesotho 🇱🇸, we are expediting the regulatory procedures. There is a lot of early demand from overseas markets.
With German company Demecan, SafriCanna has already agreed to an offtake arrangement for 500 kg for 2023. The company also wants to finance $40 million for production facilities, increasing annual output to 25,000 kg by 2024.
Former MTN CEO Sifiso Dabengwa and Nigerian businessman Bassiem Hadar are among the investors.