Labat is selling its cannabis assets to former CEO Brian van Rooyen and director David O Neill for a theoretical price of R23 million, but no cash will change hands.
The surprise announcement on the JSE’s SENS news service came late on Friday, 14 November 2025, in which Labat said the sale of the group’s cannabis interests to P64 Investments had been terminated by “mutual consent” and instead the transaction would be with All Trade Propriety, a company that it has now revealed is ‘beneficially owned’ by van Rooyen.
Although the SENS announcement came through shortly before the JSE closed on Friday, Labat’s share price ended 20% higher in reaction to what appears to have been a last-minute switch in plans to dispose of the group’s controversial cannabis interests, but in reality appears to have been with the same principal all along.
Labat’s cannabis team has effectively done a management buy out
Cannabiz Africa understands that CannAfrica CEO Herschel Maasdorp resigned his Labat directorship last week and is joining van Rooyen, whose son Stanton is expected to follow suit – in other words, Labat is seeing a soft management buyout of its cannabis interests pending shareholder approval at the upcoming 2 December AGM. Van Rooyen and O’Neill and any parties related to them will be precluded from voting.
The market has long been anticipating a sale of CannAfrica and other cannabis interests since Labat’s new board indicated 12 months ago it wanted to exist the ‘high risk’ cannabis business and ‘pivot’ into the IT space.
Labat released a cautionary in June this year saying it was selling ‘certain assets’ to a related party, All Trading Propriety, prompting market speculation that van Rooyen was behind the deal. However, it announced two weeks ago that it had decided against a deal with All Trading and was instead selling its cannabis interests for R23 million to an ‘unrelated party’, P64 Investments.
Just how unrelated a party P64 was, is questionable, as Cannabiz Africa revealed that its beneficial owner, metering systems entrepreneur Hymie Pedro, and van Rooyen, had been sole directors of a company Friedshelf 477 Investments 20 years ago.
That consideration, however, has fallen by the wayside as P64 is now out of the picture and Labat has admitted the sale of cannabis interests is a ‘sweetheart deal’ with van Rooyen after all. Even though the sale price is theoretically R23 million, this will be offset against loan accounts and Labat says it will get no financial return from the sale but in return will dispose of the liabilities associated with its cannabis interests.
Labat’s statement said that the sale to All Trading was “on improved but commercially comparable terms to the prior transaction, for a total consideration of R23 million” but that this will “be discharged through set-off against related party shareholder and director loans, thereby reducing Labat’s liabilities. No cash proceeds will be received.”
The assets that will be sold to All Trading are;
– CannAfrica (Retail) – retail arm providing premium cannabis products through company-owned stores and franchisees.
– Sweetwaters (Cultivation and Extraction) – cultivation site and extraction operations in Kenton- on-Sea, Eastern Cape.
– Biodata (Research and Development) – phase 1 & 2 clinical trials and observational studies.
– ACE (Genetics) – development and propagation of cannabis strains.
– THC (Consulting) – consulting across Africa on cannabis and hemp strategies.
– Labat Healthcare (Dormant) – dormant entity holding a bank account.
Labat said it was getting rid of its cannabis assets because the “regulatory and operational risks associated with medicinal cannabis and retail have proven challenging, and the newly appointed board members do not wish to pursue cannabis investments.”
It says “the disposal will conclude Labat’s strategic exit from cannabis and strengthen its balance sheet. The company says it will redeploy resources into ICT, logistics, and digital platforms.
“Labat is pivoting towards technology and ICT, and the disposal supports this strategy by divesting of non- core assets. Recent acquisitions such as Classic International and Ahnamu provide a solid foothold in IT hardware and software distribution across Africa.”
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