Medicinal cannabis wholesaler, Health House International, is set to establish a major foothold in Europe after striking an all-script deal to acquire German firm CanPharma.
CanPharma imports and distributes third-party dried flower into Germany and this month launched its own-brand range of extracts.
It also owns Spanish medicinal cannabis consultancy Kalapa Clinics which operates a patient-facing model and provides educational training to health care professionals.
Health House director Paul Mavor said the acquisition will provide a “beachhead” into European markets.
“Germany is currently Europe’s biggest medicinal cannabis market and third in the world behind the US and Canada. This is a massive opportunity for Health House,” Mavor wrote on LinkedIn.
Shares in Health House climbed almost 9% to close last night at $0.185.
Germany is rapidly becoming a key export market for Australian firms, with Australian Natural Therapeutics Group (ANTG) set to ship two tons of dried flower to the European powerhouse over the next 18 months.
Total imports of flower into Germany climbed 37% in 2020, according to consultancy Prohibition Partners, with a decline in supply from the Netherlands replaced by product from several other international markets, Australia among them.
In a statement to the ASX, Health House said the acquisition, which is subject to shareholder approval, will give the business a major presence in Europe’s largest medicinal cannabis market.
It will also provide doctors and patients in Germany with a range of Health House products, the company said.
CanPharma chief financial officer David Attwood will become group CEO of Health House upon completion of the acquisition, expected in early July.
Health House chairman David Wheeler described it as a “wonderful opportunity” to invest in a “quality business”.
“[It is] entirely consistent with its [Health House’s] stated ambitions to be a globally significant distributor of medicinal cannabis products,” he said.
CanPharma founder Dr Henrik Sprengel, who will become an executive director of Health House, added: “Together we are poised to build a winning position in Germany and leverage this blueprint into the rest of the EU to assume a leadership position in Europe, the region with the largest medicinal cannabis potential.”
Sprengel launched CanPharma in April 2019, having founded Kalapa in 2017.