AusCann Group (ASX:AC8) has entered into a Share Sale Agreement with Animal Health Holdings to partially divest its animal health business, CannPal Animal Therapeutics, by divesting 52% of CannPal to AHH.

The Partial Divestment is expected to enable CannPal to operate as an unencumbered and private animal health company better positioned to attract, secure and maintain strategic partnerships and resources for the continued development and commercialisation of AusCann's animal health assets.

AusCann says it will retain a 48% free-carried interest in CannPal, with no obligation to provide any further funding for the continued development or commercialisation of the CannPal animal health assets.

AHH is in confidential discussions with potential partners and other providers in relation to procuring funding to.