Anyone else suspecting it’ll be for an acquisition of a nearby grower?
Cannot really see any reasoning why they’d require more than the $2.5mil on hand + $2mil available (plus that they’ve gone to market rather than acquire further bank funding). Unless they’re planning on very substantially increasing processing facilities. Although the relationship with SunPharma makes me not think this is the case.
They’re cash flow positive and I suspect that they’ve sold more product than they are able to produce and hence acquisition is their pathway to fulfilment. Especially given uncertainties regarding outdoor crops and mitigation of risks in terms of weather and infection.
Capital raise isn’t where I thought we would be, but I suspect this will bring more opportunity. It would have to be necessary, given that Nan and co. will be diluting their holdings.
There’s a long list of potential purchases listed on the TGA approved growers list.
It would be nice to dampen the blow with some accompanying positive news, but I suppose we will have to wait and see.
ECS Price at posting:
2.5¢ Sentiment: Buy Disclosure: Held
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