MGC Pharmaceuticals Ltd surges on cannabis food supplement deal with

10.28am: Mining group adjourns annual meeting

Ormonde Mining PLC (LON.ORM) has seen its shares subside after it adjourned its annual meeting after failing to get the support of its largest shareholder for two resolutions relating to issuing new shares.

The dispute causes a problem since Ormonde had planned to use new shares as part payment for what it calls a transformation deal, to acquire a stake of up to 80% in two licences for copper and polymetallic projects in the Republic of the Congo.

It said: “Ormonde has come to the decision to dissolve the AGM as a result of being unable to obtain the support of the Company’s largest shareholder for Resolutions 6 and 7. Resolution 6 would have allowed the Company to issue shares to third parties as consideration for a transaction. Both resolutions are routine annual resolutions for listed companies and similar resolutions have been approved by Ormonde shareholders over recent years.”

The terms of the deal had been under discussion for months and are largely agreed, said the company. “While the transaction could be completed as an all-cash transaction without any shareholder approvals, the company believes the optimal formula is a milestone-based mix of cash and Ormonde shares as consideration for the acquisition, as do the counterparties, demonstrating their confidence in the prospects for the licences and their desire to participate in the value accretion potential for the company. In addition, the board would prefer to retain as much cash in treasury as possible to be put into value-enhancing and on-the-ground activities in the Republic of the Congo.”

It is now working to find a successful resolution but warned: “There can be no certainty that a deal will be concluded.”

Ormonde’s shares are down 22.92% or 0.55p at 1.85p. The latest listings show veteran investor Thomas Anderson as a major shareholder with 21.96%.

9.05am: First London cannabis-sector company climbs again

Another day, another surge in a medical cannabis stock.

 () () () has jumped 50.94% or 2.43p to 7.2p after it signed an exclusive supply and distribution agreement with Swiss  AG, for the sale and distribution of its food supplement ArtemiC products.

The deal marks the first sales of ArtemiC as a food grade product and provides MGC Pharma direct access to the large and rapidly growing markets that are still reporting high numbers of COVID-19 cases.  It follows a successful clinical trial on 50 COVID-19 patients, to evaluate the safety and efficacy of the anti-inflammatory product, ArtemiC Rescue in December 2020.

MGC was the first cannabis-sector company to float on London’s main market when it joined less than two weeks ago at just 1.475p a share, although it has been listed on the Australian market since 2016.

Making a similar share price leap is Scirocco Energy PLC (LON.SCIR), up 0.48p or 50% to 1.43p. In a strategy update the company said its planned move into the low-carbon market – including renewable energy and energy storage – had lead it to identify some near-term investment opportunities.

It said: “[The] target acquisitions under review are consistent with the company’s goal of acquiring cash generative investments within the European energy market whilst broadening the target market and improving risk/reward….

“Based on the pipeline of opportunities within its new area of focus, the board is targeting an enterprise value invested asset base of £150mln, capable of generating cash flow of circa £20mln per annum, within five years.”

At the current share price the company’s market capitalisation is around £10m.

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