Tuesday, September 27, 2022

Chrystal enables £2.1m fundraise and planned RTO for CiiTECH

Investment house, Chrystal Capital Partners LLP has played a “critical role” in a £2.1m fundraise and finding a capital markets partner for CiiTECH Ltd, an Israel and UK-based cannabis research and brand-building company, according to Clifton Flack, the founder and CEO of CiiTECH. The capital has been raised via convertible loan notes (CLNs) and will be used in part to finance a planned reverse takeover (RTO) with Fragrant Prosperity Holdings Ltd, a specialist cannabis investment vehicle listed on the London Stock Exchange, whose shares have been suspended pending completion of the RTO.

CiiTECH will also deploy the funds on implementing its marketing strategy, investing in new talent and building its operational infrastructure.

According to a statement from Chrystal, the fundraise attracted strong support from FastForward Innovations Ltd, alongside professional family offices and ultra-high-net-worth individuals.

Tristan Gervais, the head of Chrystal Capital Cannabis Advisory (CCCA) comments, “We are delighted to have advised CiiTECH on its successful fundraise, and on finding an excellent partner in Fragrant Prosperity. Our unique cannabis sector expertise, together with our extensive relationships with cannabis investors, continues to deliver much-needed growth capital and M&A solutions to this exciting, fast-growing industry. CCCA will continue to work closely with the management team on the RTO and beyond as CiiTECH continues to grow.”

Mr Flack refers to CiiTECH’s “science-led approach”. The company emphasises the partnerships it has with academic institutions, and invests a proportion of its consumer brand profits into ongoing research, according to a company statement: “This can be anything from clinical trials to patent formulations and licensing agreements. We have an ongoing partnership with the Hebrew University of Jerusalem in Israel, exploring indication-specific trials that will lead to targeted products.” CiiTECH’s first brand, Provacan, was launched in 2016; it is a range of therapeutic products designed to appeal to a broad demographic. This has been followed by partnership brands, Impact (a sports brand), HuGG Co (a female lifestyle brand) and Propaws (for pets). In the pipeline are a weight-loss brand, and a hangover remedy.

According to figures quoted by Chrystal, CiiTECH has generated over £7m in revenue since its inception.

Mr Flack comments that he is looking forward to completing the RTO and CiiTECH becoming a listed business: “We are pleased with the strong interest in this fundraise, which will allow CiiTECH to continue to execute our aggressive growth strategy. I thank all our new and existing investors for their support as we build the business and pursue exciting opportunities. Chrystal has played a critical role in not only raising the capital, but also finding an optimal capital markets partner in Fragrant Prosperity.”  

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