NEW YORK and TORONTO and HERZLIYA, Israel, Jan. 26, 2021 /PRNewswire/ — Subversive Real Estate Acquisition REIT LP (OTCQX: SBVRF; NEO: SVX.U) (“SVX”), a special purpose acquisition company (SPAC), today announced its qualifying transaction to combine with InterCure Ltd. (dba Canndoc) (TASE: INCR), Israel’s leading cannabis company (the “Transaction”). Canndoc, a wholly owned subsidiary of InterCure Ltd., is Israel’s largest licensed cannabis producer and one of the first to offer Good Manufacturing Practices (GMP) certified and pharmaceutical-grade medical cannabis products in pharmacies across the country. With the largest distribution network, significant logistical capabilities, and a lucrative vertically integrated strategy, Canndoc is the fastest-growing and most profitable cannabis company in Israel, with a Q4 2020 expected EBITDA annualized run rate of greater than US$10 million and positive free cash flow. Furthermore, we believe that Canndoc is well-positioned to capitalize on the adult-use market in Israel, which is expected to be legalized in 2021 or 2022.
We are excited to announce today’s qualifying transaction, which, upon closing, will allow our shareholders to participate in the upside of the Israeli cannabis market. Canndoc has been a pioneer, leading the cannabis wave in Israel and capturing significant market share.
Michael Auerbach, Founder of Subversive Capital, added, “We believe Canndoc possesses superior management, an optimized platform, and the brands and partnerships that set the stage for sustained, profitable growth in key medical and adult-use markets in Israel and beyond.” Click here to access Mr. Auerbach’s video message further highlighting Canndoc’s potential and growth outlook.
Canndoc’s Chairman and former Prime Minister of Israel, Ehud Barak, added, “I’m extremely proud of the work we’ve done at InterCure and Canndoc, and I am looking forward to leading this new chapter. As we discover the scientific advantages in cannabis alongside new favorable legislation, the cannabis industry is unleashing its disruptive commercial potential. Israel became famous for its breakthroughs in cannabis research and has now become one of the leading medical cannabis markets in the world. Canndoc has proven its ability to execute a profitable growth strategy as it became the dominant force in Israel. Nowadays, we are well positioned to lead new emerging cannabis markets as legislative reform is spreading around the globe.” Click here for a video message from Mr. Barak.
Canndoc’s Chief Executive Officer, Alex Rabinovitch, added, “We are thrilled to be partnering with Subversive Capital in this transaction. The SPAC structure facilitates our ability to access growth capital in a relatively short timeframe which, in turn, will support new strategic growth initiatives and drive shareholder value.”
SVX has also announced a US$65 million private placement, pursuant to which it will issue 6.5 million units at a price of US$10.00 per unit immediately prior to, and conditional on, completion of the Transaction (the “Private Placement”). The proceeds of the Private Placement are intended to be used in connection with the Transaction and to fund the growth of Canndoc following closing. Based on sources and uses of capital, SVX will have sufficient cash to satisfy the Transaction’s cash closing condition.
It is a condition to closing that, upon closing, the combined company will commence trading on Nasdaq, which listing will be subject to approval from the exchange, and trade on the Tel Aviv Stock Exchange. Further details regarding the post-closing ticker symbol will be provided in advance of closing.
SVX has filed today an investor presentation which describes Canndoc’s business in more detail. Pursuant to the applicable rules, SVX will file with the Canadian securities regulatory authorities of each of the provinces and territories of Canada, except Quebec, a non-offering prospectus containing disclosure regarding the Transaction and InterCure assuming completion of the Transaction.
Completion of the Transaction, which is expected in April 2021, remains subject to the satisfaction or waiver of certain customary conditions including, among other things, (a) requisite shareholder and regulatory approvals and (b) approval to list the shares of the combined company on Nasdaq.
This press release is not an offer of securities for sale in the United States, and the securities referred to herein may not be offered or sold in the United States absent registration or an exemption from registration. The securities have not been and will not be registered under the United States Securities Act of 1933.
To invest in SVX, investors may buy or sell shares through their usual investment platform or brokerage. Today, U.S. investors can buy and sell OTCQX securities under the ticker symbol “SBVRF” and Canadian investors can buy and sell through the NEO Exchange under the ticker symbol “SVX.U.” It is a condition to closing that shares of the combined company to commence trading on Nasdaq on closing, and the shares are expected to continue to trade on the Tel Aviv Stock Exchange under the symbol “INCR.” SVX anticipates that the Transaction will close in April 2021.