Feb 12 (Reuters) - Northern Leaf Ltd is close to hiring a lead broker for a London stock listing later this year, its financial adviser said, a month after it became only the second company to receive a license for growing medical cannabis in the British Isles.
The Jersey-based company, preparing to grow cannabis in a 75,000 square feet greenhouse on the island, is currently raising 5 million pounds ($6.91 million) in private funding before the initial public offering, its adviser Tristan Gervais told Reuters.
Surging demand for medical cannabis, increasingly used to cope with mental health conditions such as depression, anxiety and insomnia, has pushed countries across Europe to consider tweaking their laws.
Britain last year paved the way for medical cannabis companies to list on the London Stock Exchange (LSE), sparking a race between firms to go public and raise money.
Australia’s MGC Pharmaceuticals Ltd became the first medical cannabis company to trade on the LSE on Feb. 9, with its shares more than trebling since the debut.
“The UK Capital Markets are now open for strong medical cannabis businesses with appropriate UK licenses,” said Gervais, who heads cannabis advisory at merchant bank Chrystal Capital.
Northern Leaf expects its first commercial harvest in the third quarter and can produce 6,500 kilograms of dry flower at full capacity. The company plans to sell its harvest in countries including the United Kingdom, Israel and Germany.
It plans to use the proceeds from its IPO to expand cultivation, install an extraction facility and build its own medical brands, Gervais said.
Northern Leaf received its license nearly 22 years after GW Pharmaceuticals became the first company to win British approval to grow medical marijuana in the country. ($1 = 0.7240 pounds)
Reporting by Shariq Khan in Bengaluru; Editing by Aditya Soni