FastForward Innovations (AIM:FFWD ) has broadened its exposure to the cannabis and wellness industry by investing £0.175m in the cannabis healthcare firm, CiiTECH Limited.
The London-listed investment firm which is focused on fast-growing and industry leading businesses told investors that it has participated in the £2.1 million issuance of Convertible Loan Notes, by research-led cannabis healthcare company, CiiTECH Limited, ("CiiTECH").
As part of its total investment, the Company highlighted that it took £0.175 million of the issue, funding its investment in the 24-month CLN through its existing cash resources.
The CLNs are being issued ahead of CiiTECH's intended reverse takeover by Fragrant Prosperity Holdings Limited, (LSE: FPP) announced on 24 May 2021. The CLN will attract interest of 10% per annum, payable upon maturity or rolled-up upon conversion to equity.
CiiTECH, which markets EU legal and non-psychoactive cannabis products, will use the capital raised via the CLN to fund its marketing strategy, invest in new talent, build essential operational infrastructure to support future growth and finance its intended reverse takeover.
CiiTECH, whose pipeline includes its flagship brand Provacan as well as additional brands, including Impact and Hugg, has generated over £7m in revenue since its inception in 2017.
Shares in FastForward Innovations have increased by over 5% in value since the beginning of 2021. The stock was trading 3.07% higher this morning at 8.4p following the announcement.
The Group said its expansion into new high-growth markets, such as Brazil and South Africa, is complemented by exciting research partnerships with leading academic institutions.
CiiTECH had £0.42m in unaudited net assets as at 31 December 2020 and an unaudited loss before tax of around £74,000 on revenue of around £3m for the year to 31 December 2020.
CiiTECH said it is currently funding a range of clinical studies aimed at unravelling the large range of minor cannabinoids, to bring a better understanding and more effective products to market.
Commenting on the Group’s investment, Chief Executive Officer of FastForward Ed McDermott, said: "CiiTECH is an established company with an outstanding reputation as a consumer facing brand-builder while being dedicated to medical cannabis research.
The investment, which was made alongside other professional and ultra-high-net-worth investors, is expected to broaden FFWD’s exposure to the cannabis and wellness industry.
He said, “CiiTECH has a diverse portfolio of healthcare brands each producing quality medical cannabis products to fit the ever-expanding market demand for them. We look forward to supporting CiiTECH with its aggressive growth as it advances towards a London listing."
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