The market may be pushing notably higher today, but the Queensland Bauxite Ltd (ASX: QBL) share price is vastly outperforming it.
In early afternoon trade the bauxite and medicinal cannabis company’s shares are up over 13% to 4.3 cents.
Why are Queensland Bauxite’s shares storming higher?
After the market closed on Wednesday Queensland Bauxite announced that its soon to be wholly owned Medcan Australia business has been issued with both an Import and Export Licence under the Office of Drug Control.
According to the release, these licences will allow Medcan to join the likes of AusCann Group Holdings Ltd (ASX: AC8) and Cann Group Ltd (ASX: CAN) in capitalising on the international and local opportunities by both importing and exporting a wide range of cannabis products.
These include products such as cultivars, dried flower finished products, medicinal cannabis manufactured locally under GMP Licences, medicinal cannabis listed as export-only or registered in the ARTG, and Canntab XR Pills produced in Canada.
Medcan Australia’s CEO, Craig Cochran appears pleased with the news. He stated that: “We are extremely happy to add the import and export licences to our current suite of licences. This brings Medcan Australia another step closer to our vision of providing patient specific Medicinal Cannabis products to the people that need them most. It also allows us the ability to capitalise on various opportunities in the international market immediately.”
It is worth pointing out, though, that Queensland Bauxite does not yet own Medcan, but has entered into an agreement to acquire it through the issue of 250 million QBL shares.
Considering how everything appears to be going well for Medcan, it is a little perplexing why it would let a mining company acquire it when it could just go it alone. Perhaps Medcan sees something in Queensland Bauxite’s repertoire that it is missing.
I’m a little sceptical on things so plan to sit this one out and watch on from the safety of the sidelines.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.