Is The Akanda IPO A Good Investment?

Described in 1850 as a medicinal compound, the origination of cannabis in the U.S. started innocuously if not endearingly. But by the next century, the narrative completely shifted, with politicians using the much-maligned plant to form wedges among various population groups. Still…

through reform and a deeper understanding, both the U.S. and several members of the international community are undergoing a major rethink toward marijuana legislation. It’s under this framework where the introduction of Akanda Corp. presents upside opportunities but also severe risks.

What Does Akanda Do?

A botanical specialist focusing on the international medical cannabis and wellness industry, Akanda Corp. is, if anything, one of the most structurally intriguing new listings to enter the capital market in recent memory. Based in the U.K. and incorporated in Canada, Akanda’s manufacturing operations occur in the Kingdom of Lesotho — a mountainous country surrounded entirely by South Africa. Interestingly, Lesotho owns the distinction of being the southernmost landlocked country in the world.

Typically, publicly traded companies with ties to the African continent focus on resource-extraction businesses. However, Akanda aims to change this framework through its four main pillars of operation.

  • Medical cannabis: Focus on the manufacturing and distribution of high-quality medical cannabis and wellness products to organically improve quality of life for customers in legal jurisdictions.
  • Pharmaceutical quality: Leverage the ideal conditions of Lesotho with the high-efficiency business models which Akanda’s partners provide to generate cannabis that meets good agricultural and collecting practices (GACP) guidelines at scale.
  • Ethical principles: Through a commitment to environmental, social and governance (ESG) considerations, Akanda particularly drives support for empowering women and vulnerable populations within Lesotho’s communities.
  • Patient access: Evangelize the benefits of patient access in legal international markets so that more people will have avenues for alternative botanical solutions.

Per Akanda’s website, it labels Lesotho as the “largest medical cannabis cultivation zone on the planet.” With increasing awareness of Africa’s role in the botanical industry, Akanda could be an early frontrunner in the burgeoning space, though extreme caution is a must for interested buyers.

When is the Akanda IPO Date?

Scheduled to enter the capital market at the stern of the final complete week of February, Akanda’s initial public offering (IPO) may encounter a relatively muted response because of multiple distractions afflicting Wall Street. But barring any unexpected disruptions, Akanda will likely officially price its offering on Feb. 24, 2022, hitting the IPO calendar one day later.

Shares will trade on the Nasdaq exchange under the ticker symbol AKAN.

Although the idea of a rapidly expanding cannabis cultivation economy in southern Africa will undoubtedly pique curiosity among market observers, it’s important to realize that financial realities have already started to mitigate some of the early enthusiasm. Indeed, assessing the timeline for Akanda’s journey into the public fray is instructive.

Back in November 2021, the cannabis specialist submitted a confidential draft registration statement on Form F-1 with the U.S. Securities and Exchange Commission (SEC) regarding its IPO intentions, per Akanda’s press release. Back then, the document represented a placeholder, with no terms listed for the offering.

Later, on Jan. 31, 2022, the company set the terms for its IPO, declaring an intention to raise $20 million through the distribution of 4 million units of AKAN stock at a per-share price range between $4 and $6. At the midpoint of this estimate spectrum, Akanda would have…

 

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