Israeli cannabis producer InterCure’s proposed acquisition of rival medical marijuana company Cann Pharmaceutical, also known as Better, was terminated after the companies failed to bridge differences.
Herzliya-based InterCure had announced the proposed transaction, valued at $35 million (44.4 million Canadian dollars), approximately one year ago.
It’s the latest breakup in the cannabis industry and underscores the difficult market conditions facing marijuana companies.
They include a dearth of funding, falling wholesale cannabis prices and macroeconomic headwinds.
In January, U.S. multistate operator Ayr Wellness said it canceled its planned acquisition of Chicago marijuana retailer Dispensary 33, noting the “cannabis market has changed significantly in the 15 months since” the proposed $55 million deal was hammered out.
In a Wednesday news release, InterCure said its plan to purchase Better, based in Tel Aviv, Israel, was terminated because the closing conditions in the original agreement had not been met.
The terms of the original agreement required the merger to be completed by 5 p.m. Israel time on Jan. 31, 2023.
InterCure did not elaborate on the unmet conditions.
However, last November, the Israeli cannabis producer had warned of “fundamental disagreements” between the parties, “including open matters which were not concluded at the time of the signing the agreement, in addition to a disconnect between the parties, which pose doubts as to whether the transaction will in fact be completed.”
In the release, InterCure said it is owed “significant amounts” of money, which it had loaned to Better.
“Since the agreement was terminated, (InterCure) intends to recover said amounts under all legal means available to it,” the Israeli cannabis producer said.
Shares of InterCure, which also does business under the name Canndoc, are traded as INCR on the Nasdaq.