Germany’s SynBiotic SE has acquired 50.1% of a leading group of German hemp companies from industry veteran Daniel Kruse for €11.2 million (~$12.6 million) in a key strategic matchup that creates one of the most powerful hemp enterprises on the European market.
Munich-based SynBiotic, the largest publicly traded group of cannabis companies in Europe, said following announcement of the deal that it expects combined operations to reach 2021 sales of €15 million on a pro forma consolidated basis.
“This combination makes SynBiotic SE the next unicorn candidate and a dream partner for me,” said Kruse, who will continue to manage the four companies involved in the transaction. “The supply chain of our group of companies makes an excellent addition to the enormous dynamism of SynBiotic SE,” Kruse said.
Kruse, who recently marked 25 years in the hemp industry, heads the fleet of companies that span a number of hemp sectors. They include Hanf Farm GmbH, the largest organic hemp farming company in Europe; Hempro International GmbH, the biggest hemp food distributor in Central Europe; solar-powered Hemp Factory GmbH, the largest hemp food processor in Central Europe; and MH medical hemp GmbH, a CBD maker which also holds medical marijuana import and distribution licenses for Germany.
SynBiotic SE researches, develops and produces cannabinoid-based products. The company makes food supplements and cosmetics, is active in the medical cannabis sector and said it intends to get into the recreational cannabis market. The vertically integrated company’s operations span cultivation, production and retail sales.
SynBiotic also secured an option to acquire the remaining 49.9% of the Kruse-led group.
SynBiotic has said it is pursuing a “buy & build” investment strategy focused on EU acquisitions. The company has a market capitalization of roughly €117 million.
Kruse and fellow industry pioneer Rafael Dulon, CEO at the group’s Hanf Farm unit, bring decades of combined cannabis expertise to SynBiotic SE. Kruse is a leading figure in international hemp circles, and is current president at the European Industrial Hemp Association. He has spearheaded initiatives to clarify laws and regulations for CBD and hemp foods in both Germany and the European Union, and led efforts that eventually sparked the Europan Commission to agree on raising THC levels allowed in industrial hemp.
“SynBiotic SE benefits massively from the know-how of half a century that industry pioneers Daniel Kruse and Rafael Dulon bring with them,” said Lars Müller, the company’s CEO. Acquiring the four companies enriches SynBiotic’s portfolio with key infrastructure assets and profitable brands, Müller said.
Dulon said the partnership will let his company speed up development of its sustainable, organic farming operations, a strategy SynBiotic’s Müller fully supports. “We will be able to implement our ambitious goals in the expansion of our capacities and competencies as an agricultural primary producer and primary processor of hemp,” Dulon said. “The synergies that arise for Hanf Farm through the inclusion in the SynBiotic SE group will lead to significantly faster growth.”
Dulon, also a 25-year cannabis veteran, is an expert in organic agriculture, hemp genetics, harvesting and processing. He is the developer of the Multi-Combine HC 3400 harvester, cutting-edge hemp field technology which won the Global Hemp Innovation Prize at the World Hemp Congress in 2015, the year the harvester was introduced. He also currently serves as an expert member of the International Institute for Cannabinoids (ICANNA).
SynBiotic, which was founded in 2017, went public on Frankfurt Stock Exchange in January this year.