Another so-called pot stock is set to join the Australian share market.
Medicinal cannabis company AusCann has agreed to a takeover by ASX-listed TW Holdings, which had until now been managing wine operations.
TW Holdings intends to change its name to AusCann Group and raise $3 million to support its growth strategy.
TW Holdings made an annual loss of $302,000 in 2015, and indicated it was considering investment opportunities outside of the wine industry.
Amendments to the Narcotic Drugs Act in February have made it an opportune time for AusCann to expand its reach and access to capital markets, AusCann managing director Elaine Darby said.
The amendments allow the seriously ill to access medicinal cannabis products, and permit the growing of cannabis for medical and scientific purposes.
"Since 2014 we have been working towards establishing the cultivation and manufacture of high value and clinically tested medicinal cannabis products in Australia," Ms Darby said.
Other "pot stocks" listed on the Australian share market include MGC Pharmaceuticals and MMJ Phytotech.
Nutritional pharmaceutical firm MedLab Clinical has approval to use cannabis in medical research and is developing a marijuana-based pain treatment mouth spray.
In December 2015, minerals explorer Gleneagle Gold entered into a deal to acquire Zelda Therapeutics,an Australian biotech researching the use of medicinal cannabis.
AusCann has access to European crop breeding technology to ensure the production of high yielding cannabis varieties with the right pharmaceutical properties.
It has also linked with universities and biotechnology firms involved in the development of cannabinoid medications.
"We believe AusCann represents the best-of-breed company with an impressive team of directors, executives and shareholders behind it," TW Holdings chairman David Wheeler said.
The proposed acquisition of AusCann must be approved by TW Holdings shareholders, who are expected to meet in May to consider the deal.
TW Holdings expects to relist on the share market as AusCann Group at the end of July.
Shares in TW were down 0.3 cents at 0.4 cents at 1320 AEDT.
