Voyager Life
Voyager Life, which recently rebranded as Mendell Helium, has announced the sale of its cannabis-facing business after first announcing its intention to exit the space in June.
Subject to shareholder approval, Medell will sell its wellness operations to Orsus Theraputics, which was established in 2021 as a special purpose acquisition vehicle to become an end-to-end provider of wellness products via a buy and build strategy
As part of the deal, Mendell Helium will receive 9m shares in Orsus, representing a 28% stake in the enlarged Orsus group, and 6m warrants, which will convert into shares if certain revenue targets are met. The disposal is set to take effect from 1 October 2024, with Orsus assuming full management and financial responsibility for Voyager’s operations.
The disposal will mark a major shift in the company’s strategy, effectively seeing it exit the cannabis-space.
In the summer, Voyager announced that it had entered into an option agreement for a reverse takeover of Kansas-based natural gas producer M3 Helium Corp.
If the deal goes ahead, Mendell Helium will issue 57.6 million new shares to M3 Helium’s shareholders as payment for the acquisition. These shares will give M3 Helium’s shareholders a significant stake in the combined company. Based on current share prices, this would value the new group at approximately £3m.
M3 has also been granted access to a loan facility designed to provide financial support for the development of its helium drilling operations.
Voyager has committed to making up to $500,000 available to M3 Helium under this loan facility. This agreement is structured as a commercial, arm’s-length transaction between the two companies.
Later, in its full-year financial report, Voyager confirmed its plans to acquire M3 Helium, and sell its existing plant-based health and wellness operations, allowing shareholders to retain potential upside through new ownership.
The shift in strategy came despite reporting that its CBD division grew significantly over the year, driven by white label production.
CBD revenues grew from £284k last year to £304k in the 12 months to March 31, 2024. Despite this, the company still reported a pre-tax loss of £1.1m. Total assets were £929,000 and net assets £140,000.
The company suggested that this loss, which stayed flat year-on-year, was in part due to its numerous failed M&A deals, including the attempted acquisition of UK medical cannabis cultivator Northern Leaf.
In the report, published on September 30, Voyager stated a number of reasons behind its decision to exit the sector, firstly a lack of investor interest in the cannabis and CBD-based markets, resulting in lower investment interest and declining share prices across the sector.
As such, the board decided that shifting focus to the natural gas industry through its acquisition of M3 represented a much higher growth trajectory and better prospects for long-term investments.
On October 01, the company announced an extension of its option to acquire M3 until January 31, 2025, and officially changed its name to Mendell Helium, revealing that M3 had already drawn down nearly $487,000 from Mendell Helium’s loan facility.
Stenocare
Danish medical cannabis oil manufacturer Stenocare has lowered its sales forecasts for a second time in three months ‘based on actual market performance in Q3 2024’.
In August, Business of Cannabis reported that Stenocare’s gross sales projection had more than halved from initial estimates of 12-18m DKK to 6-8m DKK.
Stenocare’s initial guidance from November 2023 had been optimistic, hinging on strong performance in Denmark and five other international markets. However, fluctuating market dynamics, including price competition and regulatory challenges, have impeded expected growth, the company explained.
This was reflected in Stenocare’s latest interim report, in August, which showed that gross sales for the first six months were 2.1m DKK, down from 2.8m DKK in the same period last year.
Now, Stenocare has lowered its outlook even further, announcing on Monday that gross sales are now expected to be 4.5m DKK for 2024.
This came amid lower than expected Q3 sales of 1.1m DKK, having estimates returns of around 2m DKK for products that are now near their expiry date.
Again, the company points to issues surrounding the Danish market for this significant downturn.
“Stenocare has been working to resolve certain unfavorable market dynamics concerning pricing and reimbursement principles on products that impacted the Danish market. This has been a primary reason for lower sales than anticipated, and during Q3 2024 this unfavorable situation has not been resolved as expected,” it said in a market update.
It is now reportedly exploring various financing opportunities to meet both its short and long-term capital requirements.
Cantourage
Conversely, leading German cannabis company Cantourage is predicting its revenues for 2024 will surpass €40m.
In a quarterly financial update, it said it had generated revenues of €13.2m in the period from July 1 to September 30, 2024, setting a new quarterly record for the company.
Cantourage has already exceeded last year’s total revenues of €24.9m, and posted a positive EBITDA of around €1m in the third quarter of 2024.
Philip Schetter, CEO of Cantourage, said: “It is important for investors to realize that the only areas in Germany and Europe in which truly profitable and growing business models can be established and monetised are those related to medical cannabis.
“I am not aware of any German company that is growing significantly and operating profitably with seeds, cuttings and non-commercial association structures.
“The real legalisation of recreational cannabis that contains THC, as is the case in North America, for example, is off the table here for the time being. Nevertheless, medical cannabis is here to stay and will continue to grow.”
