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  • Post Time Posted March 19, 2019
Almost six years after the South American country of 3.4 million people legalized cannabis, investors are betting Uruguay could become an export hub for medical cannabis as the industry expands around the world.

Silverpeak Life Sciences Uruguay Inc, one of the largest companies in the country’s nascent medical cannabis industry, is in talks with investment bankers to raise $35 million (US) this year to quadruple production and build a larger extraction lab in 2020, according to chief executive officer and U.S. cannabis investor Jordan Lewis.

“Our planned and desired expansion would be about 25 tons next year and that should push us above $100 million (US) in revenue,” Lewis said.

Cannabis investors have poured money into the U.S. and Canada, seeking to take advantage as easing cannabis regulations create a massive legal market for a drug that was stigmatized for decades. Meanwhile, Uruguay’s cannabis economy has been slow to develop, despite a significant head start.

Silverpeak’s wholly owned Uruguayan subsidiary, Fotmer Corporation SA, has asked cannabis regulatory agency Ircca to increase its annual production permit to 400 tons of cannabis flowers, he said.

The company will need to raise about $150 million (US) next year, possibly from public capital markets or a “strategic alliance” with a larger corporation if demand for cannabis products warrants increasing flower production to that level, according to Lewis.

Silverpeak and rival ICC Labs, bought last year for $217 million (US) by Aurora Cannabis, one of Canada’s most valuable cannabis companies, are among a handful of companies that have put money into Uruguay, investing in greenhouses and extraction labs with a goal of supplying medical cannabis to Latin America, Europe and Canada. This year could mark the start of commercial scale exports as producers seek trade permits and product certifications.

Source: https://www.bnnbloomberg.ca/cannabis-investors-eye-uruguay-in-push-for-global-weed-exports-1.1231143

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