Medical marijuana firm raises funds

Medical marijuana company MMJ Phytotech has tapped investors for a $5 million capital raising to fund its entry into the Australian market.

MMJ raised the funds through the placement of 20.8 million shares at 24 cents each, representing a 20 per cent discount to its 20-day volume weighted average price, along with attaching options.

The funds were raised by institutional investors of MMJ’s corporate adviser, Merchant Group Corporate Finance.

In a statement, MMJ said the proceeds of the raising would be used to accelerate its entry into the Australian market, now that legislation has passed for the legalisation of cannabis for medical purposes in the country.

It will also put funds towards its Israeli subsidiary which is planning a study to test its oral capsule formulation for treating pain and spasticity in patients who suffer from multiple sclerosis.

The raising was announced on the same day MMJ revealed a $3.48 million net loss for the six months to December, with revenue doubling to $274,000.

No interim dividend was declared.

MMJ shares were 11.7 per cent lower to 30 cents each at the close of trade.