Kanabo Group falls into administration as last of London’s early cannabis entrants succumbs to funding pressures

Kanabo Group plc has entered administration, marking the collapse of the final survivor from the London Stock Exchange’s first wave of cannabis listings and underscoring the structural challenges that have battered the sector since its much publicised debut in 2021.

On 28 November 2025, Damian Webb and Stephanie Sutton of RSM UK Restructuring Advisory LLP were appointed joint administrators, tasked with stabilising the medical cannabis and digital health operator while exploring options ranging from an operational restructuring to a potential sale. The move follows months of deepening financial strain that left Kanabo without sufficient liquidity to continue trading and culminated in its voluntary trading suspension in May, shortly after the resignation of its auditor and warnings that its financial position had deteriorated materially.

Founded on a promise to commercialise the VapePod medical device and capture early share in Europe’s emerging cannabis market, Kanabo tapped public markets during the short-lived rally that welcomed four cannabis companies to the LSE in early 2021. Its listing drew strong retail interest and supported acquisitions and pivots that reshaped the company from a device manufacturer into a hybrid digital health platform. Over the following years Kanabo shifted toward telemedicine, mental health services, and bricks and mortar clinics in an effort to generate recurring revenue while distancing itself from volatile cultivation and production assets. Those efforts delivered revenue growth but not profitability, and the company continued to absorb losses at a time when investor appetite for cannabis exposure collapsed and regulatory compliance costs mounted.

According to administrators, Kanabo’s working capital constraints left it unable to support its service expansion or advance its investment programmes, including a Spanish cultivation partnership that the board had previously flagged as a near-term revenue generator. Strategic reviews canvassing refinancing, equity raises, and asset disposals did not yield a solvent path forward, leaving the board with no alternative but to seek court protection. The LSE suspension removed access to public markets precisely as the company sought new capital, amplifying liquidity pressures already worsened by sector wide declines in valuations.

Kanabo’s fall comes after each of its 2021 cohort has already exited the exchange or entered insolvency processes, a pattern administrators say reflects both market fatigue and the difficulty of funding cannabis enterprises within the UK’s regulatory framework. Later this winter, RSM will assess the value of Kanabo’s technology, clinic network, and intellectual property to determine whether any element of the business can be preserved or sold. For now, the company joins a lengthening list of early-stage cannabis ventures unable to bridge the gap between initial market enthusiasm and the capital intensity required to scale in a tightly regulated environment.