New Europe-Focused Cannabis Companies Seek Listings
The TDR Three Key Takeaways regarding New Europe-Focused Cannabis Companies Seek Listings:
- Start-ups such as Grow Group and Wellford Medical from London are planning to go public on the Nasdaq in early 2025.
- Lisbon-based Somai Pharmaceuticals aims for a €250 million valuation for its Nasdaq IPO and is considering secondary listings on the Toronto Stock Exchange.
- Germany, Europe’s largest medical cannabis market, has decriminalized cannabis possession and small-scale home cultivation.
European cannabis companies are setting their sights on US IPOs in anticipation of potential regulatory changes in the United States and Germany. Start-ups such as Grow Group and Wellford Medical from London are planning to go public on the Nasdaq in early 2025. Grow Group, a medical cannabis distributor based in London, plans to go public on Nasdaq in the first quarter of 2025, aiming for a valuation exceeding £100mn. Since its establishment in 2017, the company has raised over £12mn.
Wellford Medical, a London-based manufacturer and distributor of medical cannabis serving the UK and Germany, is another start-up eyeing a potential listing on Nasdaq. Lisbon-based Somai Pharmaceuticals aims for a €250 million valuation for its Nasdaq IPO and is considering secondary listings on the Toronto Stock Exchange or the London Stock Exchange.
The US Drug Enforcement Administration (DEA) has proposed reclassifying cannabis from a Schedule 1 drug (grouped with heroin and fentanyl) to Schedule 3 (alongside anabolic steroids and ketamine). This reclassification is based on the recognition of cannabis’ medicinal properties. If approved, it could significantly reduce taxes on state-legal cannabis businesses and facilitate clinical research, which might attract more UK and European cannabis companies to the US markets.
Germany, Europe’s largest medical cannabis market, has decriminalized cannabis possession and small-scale home cultivation and removed it from the national narcotics list. This legislative change is expected to further boost the European cannabis market, which is already showing signs of renewed investor confidence and market optimism.
The market for CBD products, which are used to treat anxiety, pain, and chemotherapy side effects, could reach approximately $6.90 billion. The medicinal value of these products is one of the driving forces behind the efforts to reclassify cannabis. Yet, despite these advancements, major US cannabis companies remain barred from listing on major US exchanges due to federal laws, pushing them to list on Canadian exchanges instead.
