CannaGlobal - Operations, page-18

The deal was announced on the 13th November 2018 in the "West Australian". Promised $1 per year revenue.

Interesting that Cannaglobal was set up in July 2018 - hardly a good bet. I think Cannaglobal now has their address on their website - and nothing else.

I think holders should be asking some serious questions about where is the $1mil annual revenue promised. Also, no mention of the 10% ownership of Cannaglobal in the financial reports - how much is it worth to MXC.

MGC sells cannabis cosmetics business

MGC Pharmaceuticals has finalised the sale of itscannabis-based cosmetics business, MGC Derma, to private Canadian cannabisinvestment company CannaGlobal.

In addition to the signing of the formal definitiveagreement, MGC has also received CAD$500,000 from CannGlobal for the supply ofan initial order under an exclusive five-year agreement.

This covers the supply of cannabidiol, intellectualproperty and cosmetics materials to CannaGlobal for the manufacture of MGCDerma’s range of products.

On completion of the CannaGlobal transaction, MGCwill hold a 10% interest in CannaGlobal, allowing it to retain exposure to thecannabis-based cosmetics market.

Notably, this is a larger stake for MGC compared tothe stake granted under the original terms of the deal.

MGC will no longer have to meet any future MGCDerma working capital funding obligations, allowing the company to focus ondeveloping its cannabis-based pharmaceutical products.

Management said that due to the terms of the newfinancing provided by CannaGlobal’s investment partner, CannaGlobal is nolonger pursuing a listing on a Canadian stock exchange.

MGC Managing Director Roby Zomer said: “Thisis a significant milestone in our strategic partnership and the sale of 100% ofDerma to CannaGlobal, enabling MXC to focus on its core business to become aleading medical cannabis Bio-Pharma operator in Europe.”

Last month, the company moved to frontrunner statusin the Australian medical cannabis sector after receiving formal authorisationto sell its “CannEpil” cannabis derived epilepsy treatment in Australia.

CannEpil was developed to assist epilepsy sufferersto control their epilepsy, particularly in circumstances where traditionaldrugs are having no impact.

Its sale through specialist prescribers under theAuthorised Prescriber Scheme is expected to generate an initial $1m inannualised revenues for MGC from an initial base of about 100 patients.

In September, MGC signed a key distributionagreement with Maltese based A.M. Mangion Ltd that will fast track thedistribution of its medical cannabis based pharmaceutical products into keytarget markets in Europe.

The company also expects to start construction ofits Maltese based medical cannabis production and cultivation facility once itsigns the formal contracts to build and operate the facility in the near term.

Medical cannabis from the Maltese operation will beused to produce GMP-grade pharmaceutical products at a commercial scale forsale into the EU market which is widely expected to be worth $56 billion by2020.