SA medical cannabis business BBS Pharmaceuticals placed in administration – major shareholder Aaron Hickmann speaks out

The major backer of the VALO Adelaide 500 is embroiled in the collapse of an SA medicinal cannabis venture but hopes a buyer can be found to save the business.

The entrepreneur who provided major backing to last month’s return of the Adelaide 500 Supercar race has been embroiled in the collapse of a medicinal cannabis venture.

BBS Pharmaceuticals was licensed to produce medicinal cannabis products from its growing facility in regional South Australia and had plans to sell to both domestic and overseas markets.

However, after a series of delays and legal battles, the project stalled and administrators were appointed on Friday to take control of the company’s affairs.

The collapse leaves close to 20 mum and dad investors and other shareholders in limbo as administrators trawl through the company’s records to determine whether parts of the business can be salvaged.

BBS was established in 2017 by Stuart Bais, Samuel Butler and Brandon Smith, who remains the company’s sole director.

VALO founder Aaron Hickmann at the company’s Kent Town offices. Picture: Mark Brake

ASIC records reveal VALO founder and chief executive Aaron Hickmann took over as majority shareholder of BBS Pharmaceuticals in March last year and was a director of the company from March until his resignation in October.

VALO was last month’s Adelaide 500 naming rights sponsor, supplying 30 super screens for the event.

Mr Hickmann, who owns 86.25 per cent of BBS through his company Ikara Equities Pty Ltd, said he was unsure as to why administrators were appointed but hoped a buyer could be found to take over the company.

“When we departed in October last year, in terms of our involvement, BBS was in a strong position to present itself for sale to the market, both nationally and internationally,” he said.

“There’s considerable interest in this space for licensed companies so my only assumption is that the administrators have been appointed to help facilitate this process.

“I understand there are a number of shareholders that have invested prior to our involvement – all I’d say is any investment into a company can be perceived as risky. However, my understanding is the company is in a good position to go to market for sale and that’s going to give all the current shareholders a positive return.”

BBS Pharmaceuticals’ former chairman George Vanco with former project director Dennis Chung. Picture: Brenton Edwards

In 2020, BBS’s former chairman George Vanco said the company was on track to begin production of cannabis and medicinal products later that year following development of a growing facility powered by solar, wind and battery power.

But the project stalled and Mr Vanco resigned from the company at the time of Mr Hickmann’s appointment as a director.

Administrator David Trim from Hall Chadwick said it was too early to provide an estimate of the company’s debts or explain the specific reasons why the company faced insolvency.

Last month Mr Hickmann, who has grown VALO into a major supplier of stadium lighting technologies, unveiled his own ambitious plan to establish a huge production and innovation precinct in Monarto for the production of hemp-based building materials.

He said the collapse of BBS would not impact his vision to establish a major hemp manufacturing industry in South Australia.

Originally published as SA medical cannabis business BBS Pharmaceuticals placed in administration – major shareholder Aaron Hickmann speaks out