Australia's first initial public offering in a medical marijuana company, scheduled for this week, has been postponed until early next year.
Perth-based PhytoTech was due to list on the Australian Securities Exchange on Monday in an IPO, underwritten by BBY, seeking to raise $5 million through 25 million shares at 20 cents each.
PhytoTech executive director Ross Smith said the hold-up was caused by the ASX requesting assurances about the legality of the company's products.
Although listed on the ASX, PhytoTech will use marijuana grown in California and Uruguay to develop medical products in Israel. These will be sold in Israel, Europe, the United States and Canada - and Australia, if medical marijuana is legalised in this country.
"They have requested a legal sign-off from Israel and Australia in relation to what we are doing so as to not to be breaking any laws," Mr Smith said.
"It's fair enough but we already know that we aren't."
The Israeli legalities had been completed and the Australian sign-off was under way, he said.
"There's no rush. It looks like we will list early in the new year.
"This is the only hold-up at present, as we are moving to finalise allocations and issue holding statements to our shareholders.
"The ASX has written to us advising of our admission to the official list."
Mr Smith, 51, said the IPO had been oversubscribed three times.
"We got smashed with applications and had to cut some of our sophisticated investors back to allow some of the public in," he said. "In the end we selected 265 general public applications and gave them the minimum $2000 allotment."
PhytoTech is planning a range of medical marijuana delivery systems, including skin patches, vaporisation and nasal sprays.
Mr Smith, who is based in Israel, was known previously for his involvement in several dotcom companies that suffered rollercoaster share prices in the early 2000s. His interest in medical marijuana stems from a broken back he suffered as a young man and the pain relief he gained by smoking the drug.
Recreational use of marijuana in Australia is effectively decriminalised for small amounts and the states are moving towards legalising cannabis for medical purposes.
A bill to legalise medical marijuana could be put to Victoria's Parliament before the end of next year, with the Labor government determined to reform the state's drug laws.
Marijuana stocks are touted as the next big thing in the US, with companies such as Hemp, GreenGro Technologies, Advanced Cannabis Solutions and Tranzbyte enjoying enormous gains this year. Investors are cashing in on the trend, including the so-called "Wolf of Weed Street", who has reportedly made more than $US500,000 trading in "green" stocks.
