Acreage Holdings Archives - Green Market Report

StaffStaffFebruary 19, 2019
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5min2620

Acreage Holdings Inc. (CSE: ACRG.U) (OTCQX: ACRGF) continues its push to add strength to its consumer team with the additions of Stacey Kawahata, as the Vice President of Consumer Insights and Brand Strategy, and Joen Choe, as Vice President of Marketing. Acreage has already established itself as a leader with its star-packed board of directors and continues to add key hires from top consumer brands.

“Our long-term success depends on our ability to create differentiated national brands and products that connect with consumers. The addition of Stacey and Joen is a testament to our commitment to driving the growth of our brands and the industry overall,” said Harris Damashek, Chief Marketing Officer of Acreage Holdings. “They both bring an amazing track record and experience in creating, developing and growing breakthrough brands by connecting with consumers in culturally relevant ways.”  Both executives will report directly to Chief Marketing Officer Harris Damashek and join a growing marketing organization with Acreage.

 

As VP of Consumer Insights and Brand Strategy, Kawahata will be responsible for bringing deep consumer understanding to the center of Acreage’s product, brand, and marketing executions.

Kawahata said, “In a few years, Acreage has established the largest company in the cannabis industry—what I see as the bedrock for creating a house of brands that will revolutionize how people think of cannabis and reach the many millions in the U.S. who need or want this plant to better their lives.”

Prior to joining Acreage, Kawahata worked at VICE Media for more than four years leading global brand, content and partnership strategy for VICE’s commercial and editorial arm. She was also a leader in VICE’s internal agency, VIRTUE, working with a number of brands including lululemon (LULU), Under Armour (UA), and Apple (AAPL). In this role, Kawahata also led strategy across several VICE partnerships with companies such as Samsung, Diageo, and ABI. In her role at Acreage, Kawahata will be responsible for crafting experiences and brands that resonate with the many different consumer segments across the cannabis industry, and creating marketing strategies, programs, and executions rooted in consumer needs.

 

As VP of Marketing, Joen will lead marketing strategy and brand management efforts across a growing portfolio of brands and retail concepts, including The Botanist, Acreage’s flagship retail brand.

On joining Acreage, Choe said, “As the leader in the industry with the largest national footprint, Acreage Holdings is uniquely positioned to create the first national brands in the industry and shape the development of the most significant new industry in the world. It’s a special challenge and privilege to build brands and experiences that will help craft one of the most significant moments in consumer behavior and culture.”

Prior to his position of VP of Marketing at Acreage, Choe drove brand and commercial marketing across a variety of industries, geographies, and sizes—from global icons like Nike (NKE), Luxottica, and Absolut Vodka to high-growth brands like vitaminwater (Coca-Cola), St-Germain (Bacardi), and Aviation Gin. In addition to his deep experience in brand and marketing leadership, Choe managed product and business operations and led media and communications in roles across multiple verticals. Choe also held a leadership role at a startup in mobile health and wellness, Tangram, with products sold at Apple, Best Buy, and Target before being acquired by Kakao Ventures.

 

 


Debra BorchardtDebra BorchardtFebruary 11, 2019
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3min4260

The National Cannabis Roundtable (NCR) was announced on Friday by the group’s new leader former speaker of the House John Boehner. The group will be lobbying to remove federal restrictions that stand in the way of medical research on cannabis and encourage the development solutions to help patients.

Other agenda items for the group include working to correct the tax code and improve the banking situation for cannabis companies. NCR will also be working to help states enact their own cannabis legislation.

Boehner has come a long way since his days as the Speaker. At one time he was very vocally anti-marijuana and opposed the very legislation he will now be fighting for. Since his time as Speaker, Boehner joined the board of one of the largest cannabis companies Acreage Holdings Inc. (ACRG.U) and has described his opinion towards cannabis as “evolved.”

“As the cannabis industry grows and matures, it’s vital that we work together for a common-sense legal framework for cannabis policy,” Speaker Boehner said in a statement. As membership grows, he says, NCR will be comprised of growers, processors, retailers, wellness centers, investors, entrepreneurs, and publicly traded companies. Acreage Holdings is a founding member of the group.

Edible company Plus Products is another company that has joined forces with the group. “As the Cannabis industry matures, leading companies have a responsibility to help keep the public safe and well informed,” said Jake Heimark, CEO of PLUS. “Our mission at PLUS is to make cannabis safe and approachable and we are excited to help further that mission by being an inaugural participant in the National Cannabis Roundtable.”

“As the top edible company in the largest state, we look forward to helping shape the national dialog around cannabis consumption and make sure the cannabis industry takes a responsible role in keeping consumers safe,” said Jennifer Tung, PLUS’ Chief Risk Officer.


StaffStaffJanuary 24, 2019
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7min1740

It’s time for your Daily Hit of cannabis news for January 24, 2019.

On The Site

Super Bowl Ad

On February 3, the 53rd Super Bowl in Atlanta Georgia will decide the league champion of football for the 2018 NFL season. If you are in attendance at the Super Bowl, you will see CBD coffee ads in the stadium, but if you are watching the game from home you will be not be exposed to any cannabis related advertising.

New York-based Acreage Holdings, Inc. (CSE: ACRG.U) wanted to run an advocacy ad during the game. The ad featured three medical marijuana patients saying how the product had helped them. It made no health claims for their own products and it didn’t promote the purchase of the company’s products.  Football fans at the stadium will, however, see advertisements for Baristas Coffee Company, Inc. (OTCPK: BCCI) White Coffee and the new Baristas EnrichaRoast CBD Coffee. The company said that the ads will run throughout the day in and around the stadium before, during, and after the game, and will include a special offer to send a message to Maroon 5.

In Other News

Caliva

Carol Bartz, former CEO of Yahoo and Autodesk and former Cisco Board Member, along with three time Super Bowl MVP and Pro-Football Hall of Famer Joe Montana both participated in Caliva’s initial round of funding. Ms. Bartz will serve on Caliva’s Board of Directors.

“We are laser-focused on our strategy to build the most trusted brand in cannabis. With our best selling product portfolio, our large scale vertical integration, and our award-winning distribution channels we are confident we can maintain our growth rates in California in 2019,” said Dennis O’Malley, CEO of Caliva.

Caliva has quickly become a market leader in cannabis consumer products in California, which represents more than 35 percent of the overall United States legal cannabis market. While California’s cannabis economy shrunk by 17 percent year over year due to expanding regulations, Caliva grew its revenues by 350 percent. The company now employs over 440 workers and has two current operating locations in the Bay Area.

Kona Gold

Kona Gold Solutions, Inc. (OTC Pink: KGKG), a hemp and CBD lifestyle brand focused on product development in the functional beverage sector, is pleased to announce they have acquired the newly formed distribution company, Gold Leaf Distribution, LLC. Gold Leaf Distribution, a Florida based company, has purchased its first beverage truck, which will be fully wrapped to advertise Kona Gold Hemp Energy Drinks, HighDrate CBD Energy Waters, and Storm CBD Waters. The Company is presently conducting interviews to hire a full-time beverage sales person/driver that will establish new distribution routes in the Melbourne-Orlando Florida markets.

Elev8 Brands, Inc.

Elev8 Brands, Inc. (OTCQB: VATE) has acquired Blessed Bean Coffee, LLC. Elev8 Brands, Inc. continues to execute on opportunities for potential growth. The Company is now able to control the means of production from start to finish. Elev8 Hemp, LLC, a wholly-owned subsidiary of the Company, has seen tremendous growth over the last twelve months and should continue to do so throughout 2019. The Company has acquired Blessed Bean Coffee, LLC for 3,541,228 restricted common shares of Elev8 Brands, Inc. With the growing demand for Elev8 Hemp Coffee, the Company plans to purchase a larger roaster and other miscellaneous equipment to increase productivity and continue increasing the volume.

Plus Products

Plus Products Inc. announced that the OTC Markets Group, Inc. has approved the trading of the Company’s shares on the OTCQB® Venture Market and will commence trading under the symbol “PLPRF” on January 23, 2019. The Company’s shares will continue to trade on the Canadian Securities Exchange under the symbol “PLUS”.

Additionally, PLUS has also applied for eligibility for book-entry delivery and depository services of the Depository Trust Company (“DTC”), to facilitate electronic settlement of transfers of its shares in the United States.  This electronic method of clearing securities speeds up the receipt of stock and cash and accelerates the settlement process for investors. DTC eligibility will help enhance the Company’s potential investor base and offer a more convenient trading experience for current and future shareholders while enhancing the liquidity of the Company’s shares on the OTCQB.

Vangst

Vangst, the leading human capital resource platform to the legal cannabis industry, announced today the closing of an over-subscribed $10 million Series A financing round.  This round increases the total capital raised to date by the Company to $12.5 million. The financing was led by Casa Verde Capital and included Lerer Hippeau, among others.

 

 


Debra BorchardtDebra BorchardtJanuary 24, 2019
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5min4640

On February 3, the 53rd Super Bowl in Atlanta Georgia will decide the league champion of football for the 2018 NFL season. If you are in attendance at the Super Bowl, you will see CBD coffee ads in the stadium, but if you are watching the game from home you will be not be exposed to any cannabis related advertising.

New York-based Acreage Holdings, Inc. (CSE: ACRG.U) wanted to run an advocacy ad during the game. The ad featured three medical marijuana patients saying how the product had helped them. It made no health claims for their own products and it didn’t promote the purchase of the company’s products.

CBS which is airing the game sent an email to the company saying, “CBS will not be accepting any ads for medical marijuana at this time.” The ad would have cost approximately $5 million.

Acreage currently has the largest footprint of any cannabis company in the country with operations/licenses in 19 states. “It’s a public service announcement really more than it is an advertisement,” said Harris Damashek, Acreage’s chief marketing officer.

Football fans at the stadium will, however, see advertisements for Baristas Coffee Company, Inc. (OTCPK: BCCI) White Coffee and the new Baristas EnrichaRoast CBD Coffee. The White Coffee can be purchased through Amazon (www.trywhitecoffee.com) and the company’s new EnrichaRoast CBD Coffee (www.baristas.tv) which uses a proprietary technology introducing CBD to the beans after they are roasted can be purchased on the company’s website. 

The company said that the ads will run throughout the day in and around the stadium before, during, and after the game, and will include a special offer to send a message to Maroon 5. The spots will be seen on numerous digital displays including mobile devices allowing fans to connect via special Portals.

Baristas said that the CBD ads are only available due to Canna Broadcast Medias’ (OTCPK: CBMJ) geofencing platform which will deliver ads in and around the stadium. Canna Broadcast Media specializes in getting mainstream media cleared promoting the cannabis sector including network TV, radio, and digital ads targeting those who wish to take advantage of the incredible investment opportunities that exist in the cannabis sector.

“Having Baristas White Coffee and our new EnrichaRoast CBD coffee ads at the Super Bowl will give us tremendous exposure,” said Barry Henthorn Barista CEO. “We are thankful to the NFL, ReelTime Media, and Canna Broadcast Media for making this possible. Baristas is growing its market awareness and expanding its product offerings.”

Marijuana Super Bowl History

This isn’t the first time cannabis tried to insert itself into Super Bowl week. In 2014, the Marijuana Policy Project put up a series of billboards highlighting the safety of marijuana and challenged the NFL’s punishment of pot smoking vs. the approval of alcohol. Smart Approaches to Marijuana, the anti-marijuana group went on the defense with their own billboards, which sparked a billboard battle.

 


Debra BorchardtDebra BorchardtJanuary 16, 2019
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15min13470

New York State Governor Andrew Cuomo announced his plan to legalize adult use cannabis in 100 days. The governor did not provide a lot of details but suggested it would continue to be a restrictive program.

Of course, New Jersey also said it would legalize adult use cannabis but then found it has taken much longer to make adjustments to the rules and regulations of a conservative medical cannabis program. Cuomo did note that consumers would need to be over the age of 21 and he was very supportive of towns cities having the ability to opt out of allowing cannabis businesses.

In December the Governor said, “The fact is we have had two criminal justice systems: one for the wealthy and the well-off, and one for everyone else. He also said that law enforcement “for too long targeted the African-American and minority communities.”

On May 15, 2018, New York City Comptroller Scott Stringer published a report estimating the potential size of the state’s legal cannabis market and how much tax revenue it would generate for both the city and the state. According to the report, the New York State cannabis market could see up to $3.1 billion in annual sales, with up to $1.1 billion being generated in New York City alone. In terms of tax revenue, legal cannabis could generate up to $436 million for New York state and $336 for New York City. Some lawmakers have even suggested this money could be used to fix the troubled subway system.

A new report from ArcView and BDS Analytics is estimating the New York cannabis market could reach $1.6 billion by the year 2022, a big jump from the expected $263 million in sales for 2018. This would be the fourth biggest market in the U.S. The biggest market is California, followed by Colorado and Florida respectively.

“Let’s legalize the adult use of recreational marijuana once and for all,” he added.

During the midterm elections, the New York State government shifted to Democratic control and it was expected that the new lawmakers would fully legalize cannabis. The efforts by Cuomo as expected to be approved in Albany. The tax revenue and jobs from fully legal cannabis would be a big boost to some of the needy areas in the state.

Just this week, Canopy Growth (NYSE: CGC) said it was going to spend $150 million to build its first production facility in the U.S. after getting a license to grow hemp by New York.

Canopy Growth Corp. will spend as much as $150 million to build its first production facility in the U.S. after the Canadian cannabis company was granted a hemp license by New York state. “I applaud the political leadership at the federal and state level that has allowed today’s announcement to become reality,” Canopy Chief Executive Officer Bruce Linton said in a statement.

The company said it was reviewing locations in the Southern Tier region of New York State and said it would announce the winner within 100 days.

Cuomo is under pressure to create jobs in depressed areas in upstate New York and cannabis jobs fit the bill. A study, published by Joblift, shows that cannabis growth in California is “steadily declining,” while New York State is experiencing strong growth. New York is now third in terms of gross domestic product and is experiencing a “surge in medical marijuana job postings,” with the study saying it could hold “the most potential for overall growth in the sector.” New York experienced two times more job postings (155 vs. 67) in the first half of 2018, compared to the prior year.

Next comes the question investors want to know. Who is poised to capitalize on the New York market? Cannabiz Media is a company that tracks license holders in states around the country.

Figure 1Provided by CannaBiz Media

 

 

Company Symbol
MedMen Enterprises CSE: MMEN
Vireo Health Private Company
Columbia Care Q1 2019 Est Public Date
Etain Health Private Co.
Acreage Holdings CSE: ACRG.U
Fiorello Pharmaceuticals Private Company
iAnthus CSE: IAN
Curaleaf CSE: CURA

 

MedMen Enterprises

According to their data, it looks like MedMen Enterprises Inc. (CSE: MMEN) (OTC: MMNFF) is poised to be the big winner as a result of its acquisition of PharmaCann, which had the highest number of permits awarded in the state. MedMen acquired PharmaCann for $682 million in an all stock deal back in October. It not only doubled the reach for MedMen, but expanded its presence in New York.

MedMen had acquired New York’s struggling Bloomfield Industries at the beginning of 2018. The company had been unable to pay vendors and was looking for new investors. Bloomfield was one of the original five licensees in New York.

“MedMen is proud of its record of providing high quality products and shopping experience to medical marijuana patients in the state of New York and customers around the U.S. We believe that as New York moves to become the 11th state in the union to legalize adult use, the wealth of experience and knowledge MedMen brings having operated in other highly regulated and complex markets is an asset to the state,” said spokesman Daniel Yi. “We also believe that in order for an adult use cannabis market to flourish and thrive in New York, there needs to be a clear path for participation in ownership and jobs for new entrants to the industry. There also needs to be access to resources and capital for such new operators in communities disproportionally impacted by the war on drugs, and more specifically the prohibition of marijuana. MedMen stands ready to work with the state and to be a proactive partner with others in the community to build a sustainable and inclusive cannabis program.”

Vireo Health

Vireo Health is next on the list. Vireo  is  a physician-led multi-state medical cannabis company, that says “It is committed to safely alleviating pain by providing patients with best-in-class cannabis products and compassionate care.” Unfortunately for investors, this company is still private. Although it did raise $17 million back in August and the company said that it was planning on going public at some point.

Vireo is still making headlines as formers executives were set to go to trial at some point this year for smuggling cannabis oil from Minnesota to New York. The company was trying to move inventory to meet a New York deadline and the move was exposed due to a whistleblower. Dr. Laura Bultman and Ronald Owens, the company’s former chief medical officer and chief security officer.  face felony charges of smuggling $500,000 worth of cannabis oil into New York. They face up to two years in jail and a $3,000 fine for violating Minnesota state medical marijuana laws.

Columbia Care

Next in line for number of permits is Columbia Care, which is expected to go public in the first quarter of 2019 following a merger with Canaccord Genuity Growth (CGGC), a special purpose vehicle.  In October it was announced that the two companies would combine. The companies agreed that CGGC would be valued at C$60.7 million and that Columbia Care would be valued at US$1.35 billion. The deal is expected to close in the first quarter of 2019.

Columbia was selected to be one of five licensees in Virginia and became the first U.S. company licensed in the European Union. It was recently awarded one of the six new licenses in New Jersey.

Etain Health

Etain Health is one of the original five licensees in New York and it too remains a private company. It is female-owned only recently began to expand beyond the state lines as it looks to California as another market for its products.

Acreage Holdings

Acreage Holdings, Inc. (CSE: ACRG.U) (OTC: ACRZF) also stands to benefit due to its ownership of New York Canna, now known as Terradiol New York. New York Canna was originally formed  in 2015. The initial shareholders of New York Canna, Inc. were intended to be New Amsterdam Distributors (NAD) and EPMMNY. However, NAD and EPMMNY were unable to reach an agreement as to EPMMNY’s contributions to the operating entity and the terms of investment. NAD says it was the sole shareholder of New York Canna when it began talking to Acreage among others.

EPMMNY doesn’t agree with this assessment and recently filed a lawsuit asking for $400 million. EPMMNY says in its lawsuit that it was “frozen out” in 2016 and its stake reduced initially to 12.5% as NYCANNA merged with defendant NY Medicinal Research & Caring, which included NYCI Holdings, Impire Holdings and Acreage Holdings as investors.

Fiorello Pharmaceuticals

Firorello Pharmaceuticals also known as FP Wellness is a New York State only licensee. It is privately owned. The company lists its partners as The Clinic, Plant Consulting Group and LIU Pharmacy on its website. A report in the Daily Gazette said that Fiorello is building a medical marijuana production facility in Glenville and plans to open other dispensaries in Monroe, Nassau and New York counties.

iAnthus

Valley Agriceuticals was supposed to be sold to iAnthus Capital Holdings Inc. (CSE: IAN) (OTC: ITHUF) in 2017  for $17.3 million, but that deal was never closed. iAnthus then acquired New York’s Citiva Medical for $18 million at the beginning of 2018. According to the original press release, Citiva NY’s license included a cultivation and processing facility and four dispensary locations to be located in Brooklyn, Staten Island, Dutchess County and Chemung County. Citiva’s proposed 2,000 square-foot flagship Brooklyn dispensary was slated to open in Q4 2018, and would be one of only two dispensaries located in New York City’s most populous borough, with 2.6 million residents.

The statement said that Citiva’s Staten Island dispensary, would be the only Registered Organization serving Staten Island’s 500,000 residents and it was also slated to open in Q4 2018. The Dutchess County and Chemung County dispensaries are planned for the second quarter of 2019.

Curaleaf

Finally, Palliatech, which changed its name to Curaleaf Holdings Inc. (CSE: CURA) (OTC: CURLF) is based in Boston MA. It has locations in seven New York counties. Its website says more counties are coming. Near Manhattan there is a dispensary in Forest Hills in Queens. In the company’s last earnings announcement, it said that it estimates it will post revenue of $400 million in 2019 including revenue generated by the non-profits, and free cash flow of $100 million. Curaleaf expects to complete two acquisitions in the fourth quarter of 2018 in Maryland and Massachusetts. At the end of 2018, Curaleaf also expects to have at least 40 operational stores.


Debra BorchardtDebra BorchardtJanuary 7, 2019
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6min2420

It’s time for your daily hit of cannabis financial news for January 7, 2018.

On The Site

Jobs

As of 2018, there are more full-time cannabis workers than there are librarians, and the number is growing. These are not minimum wage positions either – retail managers, agriculture experts, and extraction technicians all earn attractive salaries and desirable compensation packages.

Patents

The number of global cannabis patent applications has doubled since 2008, Cannabis Law Report can reveal, as 2019 promises to be a landmark year for marijuana intellectual property. The World Intellectual Property Organization said approximately 10,246 cannabis-related applications have been filed since 1978 under the Patent Cooperation Treaty (PCT), with 6,137 applications coming after 2008. Experts say the number could potentially be even higher as firms exploit loopholes to snatch patents related to cannabis such as growing or treating addictions, without expressly referring to marijuana in their application.

In Other News

Green Thumb Industries Inc. (GTI) (CSE: GTII) (OTCQX: GTBIF) signed a definitive agreement to acquire Advanced Grow Labs LLC (AGL) and enter the Connecticut market. AGL is one of only four companies in Connecticut licensed to grow and process cannabis. The Connecticut-based cannabis company operates a 41,000 square foot manufacturing facility in West Haven with the potential to expand. In addition, AGL has a 46 percent ownership of a recently-awarded dispensary that will be located in Westport which makes it the only vertically licensed company in the state. Upon the close of AGL and the other recently announced acquisition, GTI will have 12 manufacturing facilities and licenses for 85 retail locations across 11 states.

Acreage Holdings, Inc. (CSE: ACRG.U) closed the acquisition of Florida-based Nature’s Way Nursery of Miami, Inc. (“Nature’s Way”). Nature’s Way was awarded a vertically integrated operating license last summer and will operate the business as Green Owl Pharms, the name under which it was awarded the operating license. The previously disclosed transaction paves the way for Acreage to bring cannabis products to Florida residents throughout the state. As of December 28, 2018, there were more than 209,000 total cannabis patients in Florida according to the Florida Department of Health Office of Medical Marijuana Use.

CannAmerica Brands Corp. (CSE: CANA) (OTCQB: CNNXF)  entered into a binding letter of intent to create a joint venture with Invictus MD Strategies Corp. (TSXV: GENE) (OTCQX: IVITF) and CBDistribution Company Ltd. with the intention of acquiring hemp biomass for extraction into CBD isolate using purpose-built facilities for large-scale CBD extraction.

iAnthus Capital Holdings, Inc. (CSE: IAN) (OTCQX: ITHUF) opened its first and flagship dispensary in New York on December 30, 2018. The dispensary, located at 202 Flatbush Avenue directly across from Barclays Center and Atlantic Terminal, is the first in Brooklyn, New York’s largest borough, with a population of roughly 2.6 million people.

CLS Holdings USA, Inc. will commence trading on the Canadian Securities Exchange, or CSE, at the opening of the market on January 7, 2019, under the ticker symbol “CLSH”. Cannabis Life Sciences is the developer of a patented extraction and conversion methodology that has the potential to increase both yield and quality of cannabinoid oils extracted from cannabis plants.

Harvest One Cannabis Inc. (TSX-V: HVT) (OTCQX: HRVOF) said that its shares of common stock were approved for trading on the OTCQX® Best Market operated by OTC Market Group.

Rubicon Organics Inc. (CSE:ROMJ) (OTCQX:ROMJF) said that its common shares are now trading on the OTCQX Best Market under the ticker symbol “ROMJF”.  Rubicon Organics’ common shares will continue to trade on the Canadian Securities Exchange under the ticker “ROMJ”.

Canopy Rivers Inc.  (TSXV: RIV) announced that its 49%-owned joint venture PharmHouse Inc. has entered into a syndicated credit facility with the Bank of Montreal, as agent and lead lender, and with Canadian Imperial Bank of Commerce and Concentra Bank as lenders. Under the terms of the Credit Facility, the Lenders will provide PharmHouse up to C$80 million of secured debt financing at a rate of interest that is expected to average in the mid-to-high 5% per annum range over its three-year term.

Dixie Brands Inc. (CSE: DIXI.U), one of the cannabis industry’s leading consumer packaged goods companies, has announced the hiring of two new marketing executives.  Andrew Floor joins as Vice President of Marketing, Dixie Brands, and Hilal Tabsh joins as Vice President of Marketing and Distribution, Aceso Wellness.


William SumnerWilliam SumnerDecember 6, 2018
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3min6660

As companies throughout the cannabis industry are seeking ways to create consistent and scalable cannabis products, Acreage Holdings Inc. (CSE: ACRG.U) is positioning itself to become the United States’ first national cannabis Consumer Packaged Goods (CPG) company. On December 6, 2018, the company announced that it has signed a definitive agreement to acquire Form Factory, a multi-state distributor and manufacturer of cannabis beverages and edible products, in an all-stock transaction valued at $160 million.

“Creating a wide range of products that meet the diversified tastes of consumers and owning the national manufacturing and distribution platform to ensure their consistent and predictable delivery on a national basis is a key to long-term success and value creation in the cannabis industry,” said Kevin Murphy, Founder, Chairman, and CEO of Acreage Holdings. “With this acquisition, we are now positioned to be both the first and only national cannabis CPG company and distribution platform in the U.S. cannabis industry.  The combination of the largest U.S. operational footprint, combined with the unique food and beverage manufacturing capabilities of Form Factory sets us on a direct path to becoming the Procter & Gamble of cannabis.”

Under the agreement, Acreage will issue 6.4 million Subordinate Voting Shares to Form Factory shareholders at a price of $25 per share. The company will acquire Form Factory’s grow/processor license and operations in the cities of Los Angeles, California; Oakland, California; and Portland, Oregon. Acreage will also acquire the management services contracts for Form Factory’s contract manufacturing business, as well as all of the company’s intellectual property.

With this acquisition, Acreage hopes to consistently manufacture and distribute branded cannabis products throughout the company’s 19 U.S. state footprint at a scalable level. In addition to cannabis products, Acreage plans on serving traditional, non-cannabis CPG companies. Although a specific date has not been set, the acquisition is expected to close within the first quarter of 2019.


StaffStaffDecember 6, 2018
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12min1940

New York City, NY – Dec. 6th, 2018 /AxisWire/Acreage Holdings, Inc. (“Acreage”) (CSE: ACRG.U) and
Form Factory, Inc. (“Form Factory”), a multi-state manufacturer and distributor of cannabisbased edibles and beverages, announced they have signed a definitive agreement for Acreage to acquire Form Factory, in an all-stock transaction valued at US$160 million. Acreage will issue approximately 6.4 million Subordinate Voting Shares to Form Factory shareholders at a deemed price of US$25 per share. The transaction brings Form Factory’s expertise as a one-stop-shop for developing, manufacturing, and distributing cannabis products of any form factor to Acreage’s 19-state footprint of growing, manufacturing and distributing cannabis-based consumer and medical products. It sets the stage for Acreage to become the first national cannabis Consumer Packaged Goods (CPG) company, capable of creating and distributing predictable and scalable proprietary brands, nationally, delivering those capabilities on a contract basis to other cannabis brands, and offering a turnkey cannabis industry solution to traditional non-cannabis CPG companies like Nestle, Mars or Procter & Gamble.

“Creating a wide range of products that meet the diversified tastes of consumers and owning the national manufacturing and distribution platform to ensure their consistent and predictable delivery on a national basis is a key to long-term success and value creation in the cannabis industry,” said Kevin Murphy, Founder, Chairman, and Chief Executive Officer of Acreage
Holdings. He continued, “With this acquisition, we are now positioned to be both the first and only national cannabis CPG company and distribution platform in the U.S. cannabis industry. The combination of the largest U.S. operational footprint, combined with the unique food and beverage manufacturing capabilities of Form Factory sets us on a direct path to become the
Procter & Gamble of cannabis.”

KEY HIGHLIGHTS:
· Acreage will acquire Form Factory, a leading commercial manufacturer of cannabis infused edibles and beverages, in an all-stock transaction valued at $160 million using common stock at the Reverse Take Over listed price of $25.00 per share.
licenses to 19 from 18, with a total addressable market of nearly $14 billion in 2022 projected legal cannabis sales, according to Arcview Market Research, and a total population of 172 million.

“We are thrilled to be joining the Acreage family,” said Tony Bash, co-founder & Co-CEO of Form Factory, Inc. “The merger with Acreage represents the fulfillment of the vision we had when we founded Form Factory. With Acreage, our mission to create the largest supplier of trusted cannabis products in the world will accelerate, providing all people with access to the
benefits of cannabis.”

Josh Held, co-founder and President of Form Factory continued “Form Factory’s innovative and proprietary delivery systems, combined with Acreage’s massive scale will ensure that we become a trusted partner enabling national brands to thrive.”

Todd Boren, Co Founder and Co-CEO of Form Factory and Managing Partner of MacArthur Investments, the largest shareholder of Form Factory, added “We embarked on this journey because we believed in the team at Form Factory and knew they were among the best in the world. Our merger with Acreage reflects the same confidence in their team and ensures we can continue to relentlessly innovate the science driving the cannabis industry to provide brands and consumers with safe, efficient and consistent product formulations.”

SUMMARY OF TERMS:
Based on the deemed issue price of US$25 per share, the total transaction is valued at US$160 million. Specifically, through Form Factory, Acreage will acquire the following tangible assets:

● Grow/processing licenses and operations in Portland, Oregon, and Los Angeles and
Oakland, California.
● Management services contract for the Washington contract manufacturing business.
● All intellectual property

60% of the consideration paid to Form Factory’s employees, including its management, or 24% of the total consideration, is subject to a 24-month vesting period, ensuring alignment of interests with both companies as we execute the plan. Key employees will be required to sign non-compete and employment agreements. Completion of the acquisition is subject to customary closing conditions, including obtaining Form Factory shareholder approval and the listing of the Subordinate Voting Shares to be issued as consideration on the Canadian Securities Exchange (the “CSE”). Listing of such shares is subject to the Company satisfying all
requirements of the CSE.

The company expects the acquisition to be revenue accretive in 2019 and EBITDA accretive in 2020.

The deal was approved unanimously by the boards of directors for both Acreage Holdings and Form Factory.

TRANSACTION CALL DETAILS
Acreage Holdings will host a call with management on Thursday, December 6th at 10:00 AM Eastern Standard Time. The call can be heard via webcast, which can be accessed on the investor relations portion of Acreage’s website at www.investors.acreageholdings.com.

A presentation with more details of the transaction may be viewed on the investor relations portion of our website at www.investors.acreageholdings.com.

ABOUT ACREAGE HOLDINGS
Headquartered in New York City, Acreage Holdings is the largest vertically integrated, multistate owner of cannabis licenses and assets in U.S. states with respect to number of states with operating licenses. With operating licenses in 19 states, serving a population of more than 172 million Americans, and an estimated 2022 total addressable market of approximately $14
billion in legal cannabis sales according to Arcview Market Research. Acreage is dedicated to building and scaling operations to create a seamless, consumer-focused branded cannabis experience.

ABOUT FORM FACTORY
Headquartered in Portland, Oregon, Form Factory is a cannabis manufacturer, co-packer, and distributor with operations in Oregon and Washington, and plans to expand in California. The company represents the combination of Gesundheit Foods, a commercial food grade co-packing company and Made By Science, and Intellectual Property portfolio for micro and macro
emulsion that provides purposefully differentiated onset times based on brand and product promises.

FORWARD LOOKING STATEMENTS
This news release contains “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forwardlooking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included herein are forward looking information. Specifically, all statements with regard to the anticipated financial results of the acquisition and the effect of the acquisition on Acreage’s business are forward-looking information. Generally, forward-looking information may be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “proposed”, “is expected”, “budgets”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases, or by the use of words or phrases which state that certain actions, events or results may, could, would, or might occur or be achieved. There can be no assurance that such forward-looking information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such forward-looking information. This forward-looking information reflects the current beliefs of Acreage and is based on information
currently available to Acreage and on assumptions that Acreage believes are reasonable. These assumptions include, but are not limited to, the assumption that the transaction will close, and the anticipated timing of closing. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of
activity, performance or achievements of Acreage to be materially different from those expressed or implied by such forward-looking information. Such risks and other factors may include, but are not limited to: general business, economic, competitive, political and social uncertainties; general capital market conditions and market prices for securities; delay or
failure to receive board or regulatory approvals; the actual results of future operations; competition; changes in legislation affecting Acreage; the timing and availability of external financing on acceptable terms; and lack of qualified, skilled labor or loss of key individuals and the other factors identified in Acreage’s Listing Statement dated November 14, 2018 and filed
under the company’s profile on SEDAR. Although Acreage has attempted to identify important factors that could cause actual results to differ materially from those contained in forward 
looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. Readers are cautioned that the foregoing list of factors is not
exhaustive. Readers are further cautioned not to place undue reliance on forward-looking information as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Forward-looking information contained in this news release is expressly qualified by this cautionary statement. The forward-looking information contained in this news release represents the expectations of Acreage as of the date of this news release and, accordingly, is subject to change after such date. However, Acreage expressly disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by
applicable securities law.

# # #

 

Investor Contact:
Steve West
Investors@acreageholdings.com
Media Contacts:
Howard Schacter
h.schacter@acreageholdings.com
Jon Goldberg/KCSA Communications
212 896 1282
acreage@kcsa.com

William SumnerWilliam SumnerNovember 29, 2018
plant2.jpg

3min5100

Today, Acreage Holdings Inc. (CSE: ACRG.U) announced its unaudited financial results for the third quarter, which ended on September 30, 2018.

Acreage reported quarterly revenue of $5.5 million, representing a 160% increase when compared to the same period in the previous year. The company’s year-to-date revenue increased by 92% to $10.6 million. The company’s net loss increased from $0.7 million in the third quarter of 2017 to $4 million. The year-to-date net loss was $2.1 million.

Gross profits for the quarter, excluding fair value items, was $1.9 million; up 118% when compared to the same period in the previous year. Year-to-date gross profits were $3.8 million, representing an increase of 76% over the previous year.

During the last quarter, Acreage launched its flagship brand, “The Botanist;” opening a cannabis dispensary in Baltimore, Maryland and increasing the number of dispensaries owned by the company to 16. By January 2019, the company expects to have as many as 23 retail dispensaries opened. Acreage was also awarded the right to receive one of eight total dispensary licenses in the state of North Dakota.

“We are in the midst of a transformative moment for the U.S. cannabis industry and we have been laying the groundwork to fully leverage our unique strategic advantages – scale, operational depth, and financial strength,” commented Kevin Murphy, Founder, and CEO of Acreage. “Our November public listing and private placement equity raise of approximately $314 million gives us the ability to continue to expand our industry-leading footprint beyond the 18 states that we are in. These efforts have laid the foundation for us to roll out the nation’s first truly national brands in the industry. With our operational foundation now in place and the tailwinds of transformational pending legislation that we anticipate will open new cannabis markets in the U.S., we believe we are in a strong position for the future.”

Acreage on the Move

Over the last month, Acreage has made a number of property purchases and acquisitions to strengthen its portfolio. Most recently the company close the acquisition of Michigan-based Blue Tire Holdings LLC, entered into an agreement to acquire the intellectual property rights of one of the world’s largest and diverse libraries of cannabis genetics, and has agreed to purchase a third Connecticut cannabis dispensary. The latest purchase in Connecticut will give Acreage three of nine dispensary licenses in the state.

 


StaffStaffNovember 15, 2018
acreage-3-600x375-1.jpg

4min1810

NEW YORK, Nov. 15, 2018 /AxisWire/ Kevin Murphy announced today that, in connection with the business combination (the “Business Combination”) completed on November 14, 2018 among certain parties, including Acreage Holdings, Inc. (the “Company”) and High Street Capital Partners, LLC (d/b/a Acreage Holdings) (“Acreage Holdings”), Mr. Murphy acquired ownership of 168,000 class C multiple voting shares (the “Multiple Voting Shares”) of the Company, representing 100% of the issued and outstanding Multiple Voting Shares.  Murphy Capital LLC and The Kevin Murphy 2018 Annuity Trust, entities under the control and direction of Mr. Murphy, acquired an aggregate of 113,102 class B proportionate voting shares (the “Proportionate Voting Shares”) of the Company, representing approximately 7.8% of the issued and outstanding Proportionate Voting Shares. Following the Business Combination, Mr. Murphy and the entities under the control and direction of Mr. Murphy continue to hold an aggregate of 15,957,908 units of Acreage Holdings (the “Convertible Units”), which are ultimately convertible into 15,957,908 class A subordinate voting shares (the “Subordinate Voting Shares”) of the Company. Upon completion of the Business Combination, Mr. Murphy also received 540,000 options (the “Options”), each of which entitles  him to purchase one Subordinate Voting Share.

Immediately prior to the completion of the Business Combination, Mr. Murphy did not own or exercise control or direction over any securities of the Company.  The Multiple Voting Shares, Proportionate Voting Shares, Convertible Units and the Options represent, on an as-converted to Subordinate Voting Share-basis (converting only the shares and securities that Mr. Murphy owns or exercises control and direction over), ownership of an aggregate of approximately 49.7% of outstanding Subordinate Voting Shares.

Mr. Murphy holds and controls his shares of the Company for investment purposes and only and Mr. Murphy may increase or decrease his beneficial ownership or control over the shares of the Company or the Convertible Units, which he may do, from time to time, depending on market or other conditions and to the extent deemed advisable in light of his general investment strategy.  The Multiple Voting Shares held by Mr. Murphy are designed to ensure that  Mr. Murphy has voting control at meetings of shareholders of the Company and the existing share structure is subject to the provisions of the coattail agreement between the Company, Mr. Murphy and the Company’s transfer agent as described in the Company’s listing statement dated November 14, 2018, which is posted and filed under the Company’s profile on www.sedar.com.

This news release is being disseminated as required by National Instrument 62-103 – The Early Warning System and Related Take-Over Bids and Insider Reporting Issues in connection with the anticipated filing of an early warning report (the “Early Warning Report“). A copy of the Early Warning Report will be available on SEDAR under the Company’s issuer profile at www.sedar.com and can be obtained by contacting the contact set out below.

For further information please contact:

Communications Contact:
Lewis Goldberg / Jon Goldberg
KCSA Strategic Communications
212-896-1282
Acreage@kcsa.com

Company Contact:
Howard Schacter
Head of Communications
917-579-0727
h.schacter@acreageholdings.com



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