International Cannabis Adds Cultivation Licences in Bulgaria/Macedonia and Macedonia’s Only Extraction Licence
VANCOUVER, British Columbia, Dec. 21, 2018 (GLOBE NEWSWIRE) — ICC International Cannabis Corp. (CSE: WRLD)(FWB: 8K51)(OTC: KNHBF) (“ICC” or “International Cannabis” or the “Company”) is pleased to announce it has entered into a definitive agreement to acquire 100 per-cent of Balkan Cannabis Corp (“Balkan Cannabis”). Balkan Cannabis controls Macedonian medical Cannabis cultivation and extraction licences, as well as Bulgarian medical Cannabis and hemp cultivation licences.
International Cannabis will leverage Balkan Cannabis’ extensive Eastern Europe network to target the second wave of European cannabis legalisation. With multiple operational offices located throughout the region, Balkan Cannabis aims to be the first mover within the Eastern European medical cannabis and hemp theatre. Europe’s medical Cannabis industry has experienced exponential growth in the second half of 2018, exceeding that of the previous five years.1
Through a subsidiary in Macedonia, Balkan Cannabis has been granted an exclusive agreement with an existing licenced facility (the “Licenced Facility”), which permits the cultivation, manufacturing and export of medical Cannabis. The Licenced Facility is located on a 30-hectare land parcel in Valandovo, Macedonia. Valandovo is a region with a storied agricultural history, access to a skilled agronomical workforce, as well as arable land and soil conditions. As a result of its proximity to neighbouring European countries, the Licenced Facility provides a significant revenue opportunity for International Cannabis.
Balkan Cannabis’ Macedonian subsidiary has also been awarded the only Macedonia extraction licence to date and is in the process of building out the country’s first dedicated industrial extraction facility. Once operational, the extraction facility will essentially control the domestic Macedonian extraction market, making Balkan Cannabis the most dominant player in the region.
Balkan Cannabis owns 67% of its Macedonia subsidiary, with the remaining 33% controlled by a strategic regional partner. The Macedonian pharmaceutical market is valued at over US$165 million per annum.2 Macedonia imports over 50% of its medical products.3
Balkan Cannabis also holds a 50% interest in a Bulgarian subsidiary, which controls licences for the production, manufacturing and export of both hemp and medical Cannabis. A prominent leader in the Bulgarian business community holds the remaining 50% of the subsidiary. Through its Bulgarian subsidiary, Balkan Cannabis controls a 15,000-hectare land parcel, with a two-year option to acquire an additional 15,000 hectares.
According to a World Bank study, 32.33% of Bulgaria’s land is highly arable and presents a unique opportunity for hemp cultivation. Bulgaria’s pharmaceutical market size is valued at over US$1.63 billion per annum.4 The country imports over 85% of its pharmaceutical products. Over 33% of the Bulgarian population is 55 years or older, resulting in disproportionately elevated cases of age-related diseases, including arthritis. Consumption of Medical cannabis and the application of hemp-derived products are known to help remedy these conditions.
RESULTING REVENUE STREAMS
International Cannabis’ acquisition of Balkan Cannabis further strengthens the Company’s ability to realize multiple revenue streams from the European medical Cannabis and hemp markets.
As a result of this acquisition, International Cannabis plans to continue its pursuit of material revenues by:
- The cultivation and export of pharmaceutical grade medical Cannabis in Eastern Europe;
- The mass production and export of hemp, leveraging its 15,000-hectare location in Bulgaria;
- The development and operation of its exclusive Macedonian extraction license; and
- The continued acquisition of European medical Cannabis and hemp licenses.
Balkan Cannabis is equipped with a highly experienced management team. Balkan Cannabis’ CEO and Co-Founder, Mr. Stevan Tafra, has extensive experience within the medical cannabis and hemp industries. In 2016, Mr. Tafra successfully founded a fully vertically integrated operation, which manufactures, extracts and exports hemp-derived cannabidiol (“CBD”). Balkan Cannabis’ Chairman and Co-Founder, Milorad Bojovic was previously CEO and Director of Jugomontaza Monting, a leader in the international processing industry.
The acquisition of Balkan Cannabis further bolsters the Company’s portfolio of European medical Cannabis and hemp assets. In 2017, the global medical Cannabis industry was valued at approximately US$15.6 Billion and is expected to rise to US$55 billion at a CAGR of 17.7%.5 Medical cannabis has proven useful in treating several health conditions ranging from chronic pain to epilepsy and depression.
The global hemp market was valued at US$5.7 Billion in 2018 and is expected to increase to US$22 billion at a CAGR of 31% by 2022.6 CBD, the active component from processed hemp, has many medical applications.
Upon closing, Balkan Cannabis Corp will transfer ownership of its proprietary license portfolio and operational assets to International Cannabis. The acquisition of Balkan Cannabis further augments International Cannabis’ robust portfolio of vertically integrated cannabis assets, as well as positions the Company to capitalize on the early and vast European medical Cannabis market.
With the addition of Balkan Cannabis, International Cannabis has access to a robust collection of medical cannabis and hemp production operations across Europe. International Cannabis plans to optimize and further expand Balkan Cannabis’ operations to become a leading pan-European exporter of medical cannabis and hemp products, as well as a establish itself continental producer to meet growing domestic demand. Primary location targets for continued development include Macedonia, Bulgaria, Serbia, Montenegro, Poland, Portugal, Greece and Denmark.
ICC International Cannabis, through its subsidiaries, has agreements in place for European-based pharmaceutical distribution, wholesale importation, and research and development, as well as licences to cultivate, produce, distribute, store and export cannabis, cannabis derivatives and industrial hemp in Colombia, Denmark, Poland, Greece, Portugal, Poland, Macedonia, Bulgaria, South Africa and the Kingdom of Lesotho.
Under the terms of the agreement, the Company will issue 61,000,000 shares. A finders fee is payable on this transaction.
ICC International Cannabis plans to announce the financing plans of its Macedonian and Bulgarian medical Cannabis and hemp operations in January 2019.
ON BEHALF OF THE ICC INTERNATIONAL CANNABIS CORP BOARD OF DIRECTORS
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Notice Regarding Forward Looking Information:
This news release contains certain “forward-looking information” within the meaning of applicable Canadian securities law. Forward-looking information is frequently characterized by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed” and other similar words, or information that certain events or conditions “may” or “will” occur. This information is only a prediction. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking information throughout this news release. Forward-looking information includes, but is not limited to: political changes in Canada and internationally, future legislative and regulatory developments involving cannabis in Canada and internationally, the Company’s ability to secure distribution channels in international jurisdictions, competition and other risks affecting the Company in particular and the cannabis industry generally.
The forward-looking information contained in this release is expressly qualified by the foregoing cautionary statements and is made as of the date of this release. Except as may be required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward- looking information to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise.
5 Medical Marijuana Market Analysis 2017, Grand View Research.