Tom Franck | CNBC
Shares of German cannabis company SynBiotic rose sharply on Thursday shortly after the incoming government pledged to make the drug legal.
The Munich-based company’s shares were up 33% to 29 euros ($33) on the Frankfurt stock exchange. The company now has a market cap of over 100 million euros.
A deal was reached on Wednesday between the center-left Social Democratic Party, the Greens and the Free Democratic Party that will see them govern together in a three-way coalition for the first time. The so-called “traffic light” coalition agreed on plans to legalize the sale of cannabis for recreational use to adults in licensed shops.
Led by Lars Muller, SynBiotic wants to use cannabis compounds to treat conditions like chronic pain, stress and sleep issues. Cannabis has a number of negative side effects depending on its strength, the frequency it is taken and the individual.
Tech investor Christian Angermayer told CNBC via email Thursday that he owns 45% of SynBiotic’s shares.
“The biggest profiteer [of German cannabis legalization] is my cannabis platform company SynBiotic, which is the only German listed cannabis company — and one of the biggest ones in general,” Angermayer said.
Angermayer has invested in a company called ATAI, which is trying to develop drugs that can be used to treat mental health conditions. ATAI’s shares popped 40% on its Wall Street debut in June but they’ve since halved in value.
Alexander Galitsa, an analyst at invest