Labat Africa, the black-owned investment company that is positioning itself for opportunities in the cannabis industry, says it has acquired a stake in a Northern Cape-based cannabis cultivation company, said on Wednesday.
The company will pay R11m for 75% of Leaf Botanicals.
Leaf Botanicals is licensed by the SA Health Products Regulatory Authority, known as Sahpra, to cultivate, harvest and export medical cannabis.
“The acquisition brings to Labat an accredited, reliable and credible producer of high-quality medicinal cannabis, resulting in Labat being active in the most significant parts of the cannabis value chain, from flower to customer, thereby ensuring that quality is a priority in every part of that chain,” Labat said in a statement.
Labat has also concluded a 10 year exclusive distribution agreement with Ace and Axle, a US-based company that produces a premium grade hemp cannabidiol (CBD) smokable that will soon be launched in SA.
It has agreed to supply Ace and Axle with its worldwide requirements for hemp CBD smokables.
The SA cannabis industry is estimated to be as large as R27bn. The global market for CBD, one of the chemicals found in cannabis plants, is expected to reach $25bn (R422.6bn) and is growing at a rate of 23.2% per year.
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