Cannasouth / Eqalis Merger will Create New Medicinal Cannabis Market Leader

As industry experts have been predicting for some time, New Zealand’s nascent Medicinal Cannabis industry is starting to consolidate, with the country’s first listed medicinal cannabis firm set to merge with a rival.

Shareholders in NZX-listed Cannasouth overwhelmingly voted in favour of a merger with Bay of Plenty-based Eqalis at a special meeting on Friday, April 28th. The deal is subject to a capital raise which if successful will shake up the industry by creating a new leader in the sector.

Cannasouth chief executive Mark Lucas told shareholders the merger would create New Zealand’s leading medicinal cannabis company, giving the combined group critical mass to accelerate innovation, combine technologies and grow faster.

Details of the structure of the proposed capital raising initiative were released to the market in April 2023. In those announcements Cannasouth advised that third party investors, including for this purpose certain Cannasouth or Eqalis shareholders were being approached to secure binding commitments to participate in the Capital Raise

So far binding commitments for $4.2 million in aggregate have been received to date.

CBD Chair, Tony Ho says, “Securing these firm commitments ahead of launching the merger related Capital Raise next week confirms the strong support for the medicinal cannabis industry and for this proposed Merger by new investors and our shareholders.”.