Annual report pursuant to Section 13 and 15(d)

INVESTMENTS IN ASSOCIATE, NET

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INVESTMENTS IN ASSOCIATE, NET
12 Months Ended
Nov. 30, 2018
INVESTMENTS IN ASSOCIATE, NET [Text Block]

NOTE 12 – INVESTMENTS IN ASSOCIATES, NET

a. On May 10, 2016, the Company and Atvio entered into joint venture agreement, pursuant to which the parties agreed to collaborate in the field of the CDMO in Israel (the “Atvio JVA”). The parties pursued the joint venture through Atvio, the Company had 50% participating interest therein in any and all rights and obligations and in any and all profits and losses. Atvio's operations commenced in September 2016.

The Company remitted to Atvio $1 million under the terms of the Atvio JVA to defray the costs associated with the setting up and the maintenance of the GMP facility. The Company’s funding was made by way of a convertible loan to Atvio, which could have been convertible at the Company’s option at any time. The Company concluded that, based on the terms of the agreement, it had the ability to exercise significant influence in Atvio, but had no control. Therefore, the investment was accounted for under the equity method. In addition, at any time following the first anniversary year of the Effective Date the Company had the option to require the Atvio’s shareholders to transfer to the Company the entirety of their interest in Atvio for the consideration specified in the agreement. Within three years from the Effective Date, the Atvio’s shareholders had the option to require the Company to purchase from Atvio's shareholders their entire interest in Atvio for the consideration based on Atvio's valuation mechanism as specified in the agreement. The above-mentioned options were accounted as derivatives and measured at fair value and was presented in the balance sheet in " put option derivative " line item (See Note 17). On June 28, 2018 the Company exercised its call options in Atvio, see also Note 4.

b. On March 14, 2016, Orgenesis Inc. and CureCell entered into a joint venture agreement (the “CureCell JVA”), pursuant to which the parties are collaborating in the field of the CDMO in Korea.

     Under the CureCell JVA, CureCell had procured, at its sole expense, a GMP facility and appropriate staff in Korea for the manufacture of the cell therapy products. The Company had to share with CureCell the Company’s know-how in the field of cell therapy manufacturing All obligations were fulfilled by the parties and each party had 50% from the participating interest and in any and all profits and losses of the joint venture. The Company remitted to CureCell $2.1 million under the terms of the CureCell JVA. On June 28, 2018 the Company exercised its call options in CureCell, see also Note 4 .

c. The table below sets forth a summary of the changes in the investments for the years ended November 30, 2018 and 2017:

    November 30,  
    2018     2017  
    (In thousands)  
             
Opening balance $ 1,321   $ (12 )
Reclass with short-term receivables   (795 )   118  
Investments during the period   -     2,429  
Share in losses   (731 )   (1,214 )
Reductions due to the acquisition of CureCell and Atvio – see also Note 4   205     -  
  $   -   $ 1,321