IM Cannabis Corp. (NASDAQ: IMCC) shares, which recently underwent a stock consolidation, were up 9.69% to trade at $2.49 in after-hours trading at the time of our last check.
How did IMCC handle the stock consolidation?
Recently, IM Cannabis (IMCC) started trading on a post-consolidation basis on the Canadian Securities Exchange (the “CSE”) and the Nasdaq Capital Market (“NASDAQ”) on November 17, 2022. The announcement that the Common Shares will be consolidated on the basis of one (1) Post-Consolidation Common Share for every ten (10) Pre-Consolidation Common Shares was made by IM Cannabis on November 14, 2022. (the “Share Consolidation”).
At the company’s annual general and extraordinary meeting of shareholders conducted on October 20, 2022, the shareholders of IMCC approved the share consolidation. The Share Consolidation was designed to raise the Common Shares’ trading price and allow IMCC to meet the minimum bid price criteria for ongoing NASDAQ listing. The number of existing IMCC Common Shares has decreased from 75,695,325 Common Shares to around 7,569,526 Common Shares as a result of the Share Consolidation.
IMCC will be focusing more on expansion:
IMCC also started exiting the Canadian cannabis industry this month in order to concentrate its attention on looking for expansion prospects in Israel, Germany, and Europe. By making this change, IMCC hopes to become a smaller corporation with a primary goal of becoming profitable by 2023. With the help of strategic collaborations with top-tier Canadian suppliers and a highly qualified sourcing staff, IMCC will continue to capitalize on the growing demand and good momentum in Israel to solidify its leading position there and push a long-term expansion strategy in Germany.
According to the Company, Germany will benefit significantly from Israel’s excellent sourcing infrastructure, which is supported by sophisticated product knowledge and regulatory experience, especially if recreational cannabis use becomes legal there. This is predicated on the idea that the German and Israeli markets share a variety of similar characteristics, including strong commercial infrastructure, highly developed digital capabilities, favorable demographics, and consumer preferences.
How will the decision impact IMCC?
The news played a significant role in IMCC’s ongoing strategy of strategic refocusing, which aims to focus its efforts on the areas with the highest value and quicken the company’s road to profitability. In order to achieve market leadership in the medical cannabis market and be fully prepared to capitalize on the recreational market once it is legalized, IM Cannabis (IMCC) is exiting the Canadian cannabis market in an effort to maximize efficiency, strike the right balance for future success, and further strengthen its Israeli operations.