Global Cannabis Applications Corp (OTCMKTS:FUAPF) has announced the signing of a letter of intent with Porto Group Global that will see the companies enter a joint venture to form a cultivation and distribution company in Portugal to serve the European Union marketplace.
The Israeli founders of the Portugal based company are established real estate, capital market, and business development professionals. They have a robust relationship with major local market participants, institutional investors, and municipalities in Portugal.
Global Cannabis Application Corp seeks to Capitalise on the budding EU market
Brad Moore, the CEO of Global Cannabis Application Corp, indicated that the European Union marketplace is among the rapidly growing and single largest cannabis marketplaces in the world today. He added that the company is seeking to partner with Porto Group to form a company that will leverage the booming medical cannabis industry in Portugal and distribution across Europe.
The CEO added that as per the commitment of the company being a fully integrated cannabis company, the joint venture will be vital in ensuring the company produces the best outcomes for medical marijuana patients. The joint venture will harness Global Cannabis’ patient-centric approach and technology and combine it with the expertise in cultivation and distribution from Porto Group to produce the best outcomes.
The joint venture plans a capital raise of C$7.5 million
According to the letter of intent, Global Cannabis will own 49% of the joint venture while Porto Group will hold a 51% stake. The parties have agreed to work together to raise C$7.5 million through a series of financing from select partners, Porto Group and Global Cannabis.
Porto Group is expected to create an operating entity that will apply for the required licenses for the joint venture to carry out cultivation in Portugal. The entity will also identify and acquire different operating locations as well as the development of personnel to manage the building and operation of the cultivation facility. The cultivation facility is expected to produce at least 3 million grams per year with a time to revenue expected to be less than two years.
The parties have also agreed that the initial milestones should be established within 30 days after the execution of the LOI.