InterCure Ltd. (NASDAQ: INCR, TASE: INCR), Israel’s leading cannabis producer, announced a significant funding initiative to support the recovery of its facility in Kibbutz Nir Oz, heavily impacted by the Gaza war. With NIS 66 million (approximately $18.2M) already secured and the potential for an additional NIS 41 million (approximately $11.6M), the company is positioning itself for a robust comeback in both local and international markets.
Key Investors Step Up with Confidence
A key highlight of this funding round is the participation of prominent investors, including CEO Alexander Rabinovich and major shareholders Yaron Yakobi and Tzahi Hagag. Their involvement not only demonstrates their commitment but also elevates their stakes in the company, each surpassing a 5% ownership threshold.
- Investment Details:
- InterCure will issue 7,349,896 ordinary shares at NIS 4.83 per share, slightly above the December 16 opening price on the Tel Aviv Stock Exchange.
- Investors will receive warrants to purchase an equal number of shares at NIS 5.70 per share, an 18% premium.
This private placement, pending shareholder approval, has the potential to boost funding to a total of NIS 77 million ($21.5M) if all warrants are exercised.
Loan Agreement Bolsters Financial Backing
Adding to this is a NIS 30 million ($8.3M) loan from a leading Israeli bank. The two-year loan ensures that InterCure has the immediate capital needed to accelerate its recovery efforts. The loan’s activation hinges on the successful closure of the private placement.
“This financial commitment is a tremendous vote of confidence from our investors and partners,” said Rabinovich. “It marks a turning point for us as we recover from a challenging year and rebuild stronger than ever.”
Recovery and Expansion Plans
InterCure’s Southern Facility in Kibbutz Nir Oz bore the brunt of the war, suffering damages that disrupted production and growth. However, the company is determined to bounce back with an ambitious recovery and expansion plan.
Focus on Recovery
The facility is eligible for full compensation under Israeli law for direct and indirect damages, including loss of profits. InterCure has already received advance payments in the tens of millions of NIS but expects additional substantial reimbursements. These funds will further bolster ongoing restoration efforts.
Expansion into International Markets
The company plans to leverage this funding to enhance its global footprint, targeting markets such as:
- Germany
- United Kingdom
- Australia
Expansion will include increased production capacity and advanced product development, aligning with InterCure’s long-term growth strategy.
Collaboration with “Tkumah” Administration
In partnership with the “Tkumah” administration and other Israeli authorities, InterCure aims to expand its Nir Oz facility beyond restoration. The plan includes doubling production capacity and introducing cutting-edge technologies to cater to developing markets worldwide.
This collaboration represents a larger effort to rejuvenate communities near the Gaza border. It aligns with broader recovery efforts for kibbutzim affected by the conflict.
Potential Outcomes for the Company
- Enhanced production capabilities to meet global demand.
- A diversified product portfolio with advanced cannabis technologies.
- Strategic positioning in Europe and other high-growth regions.
Investor Confidence Fuels Growth
InterCure’s latest funding round reflects growing investor confidence in its ability to recover and thrive. With the leadership of Rabinovich and the involvement of major shareholders, the company is well-positioned to regain its pre-war profitability levels in 2025.
Rabinovich expressed hope for a swift resolution to the ongoing conflict, emphasizing the importance of bringing displaced employees and residents back to their communities. “This investment is more than financial. It’s a step towards healing and rebuilding the lives impacted by this war.”
Michael Brown is a seasoned journalist with a knack for uncovering compelling stories within the realm of cannabis. Through his investigative reporting and in-depth analysis, he sheds light on the regulatory challenges, market trends, and societal impacts of the burgeoning cannabis industry. Michael’s commitment to objective journalism and ethical reporting makes him a trusted voice in providing readers with balanced and informative articles about this rapidly evolving landscape.
