The Daily Hit is a recap of the top cannabis business stories for July 6, 2022.
ON THE SITE
Fitch Ratings Downgrades Canopy Growth on Recent Debt Deal
Fitch Ratings has downgraded the Long-Term Issuer Default Ratings (IDR) for Canopy Growth Corporation (NASDAQ: CGC) and 11065220 Canada Inc. to ‘C’ from ‘CCC’. Fitch said it has affirmed the ‘B’/’RR1’ratings for the senior secured term loan facility. The downgrade comes after Canopy’s announcement that it had entered into privately negotiated exchange agreements with a limited number of convertible noteholders including Constellation Brands, Inc. (NYSE: STZ) through its wholly-owned subsidiary to acquire approximately CAD263 million principal amount of the notes in exchange for Canopy common shares and approximately C$3 million in cash. Read more here.
High Times Buys Consumption Lounge Paying With Zero Value Stock
Cannabis publisher Hightimes Holding Corp. posted a new filing with the SEC announcing that it made a deal back in April to buy a consumption lounge in West Hollywood CA called The Mezz. The deal apparently took place on April 8, 2022 as High Times entered into a Membership Interest Purchase Agreement with Courtney Zalewski, as manager of The Mezz La Brea, LLC, and the holders of a majority-in-interest of the issued and outstanding membership interests in The Mezz. According to the filing, The Mezz sold for $6 million consisting of $1,500,000 in convertible promissory notes and $4,500,000 of Hightimes Class A common stock. Read more here.
LeafLink Reports Drop In May Cannabis Sales
Cannatech company LeafLink’s June Flash report indicated that the month of May was a mixed bag for cannabis category sales, state-by-state performance, and pricing analysis. The report analyzed data from Leaflink’s wholesale brand distribution and retailer platforms, with markets in Arizona, California, Colorado, Michigan, Nevada, Oregon, and Massachusetts. Read more here.
Dispensaries like Bank Buildings But It’s Not The Vaults
Bank buildings are becoming attractive locations for cannabis dispensaries, but fortified vaults aren’t the reason. The banking industry has been closing bank branches by the thousands. According to the National Community Reinvestment Coalition, 9% of all branch locations in the U.S. closed between 2017 and 2021 or roughly 7,500 brick and mortar locations. This move really picked up steam during the pandemic when most people migrated to online banking. Bank consolidation and improvements in mobile banking have also contributed to the banks giving up their locations. Read more here.
5 Reasons 2022 Will Be Big For Psychedelics
Today in the psychedelics industry there is a flurry of activity by some of the industry’s biggest donors, business developers, celebrities, and other movers and shakers who are not only upping their involvement in the industry today but also laser-focused on where it is going. Read more here.
IN OTHER NEWS
Business intelligence from Akerna (Nasdaq: KERN), an enterprise software company and the developer of technology infrastructures for the global cannabis industry, today announced that U.S. cannabis shoppers spent a total of $255.5 million on adult-use and medical cannabis products during the Fourth of July weekend. Read more here.
NewLake Capital Partners, Inc.
NewLake Capital Partners, Inc. (OTCQX: NLCP), a provider of real estate capital to state-licensed cannabis operators, today announced $50 million of investments across three properties, marking the full commitment of capital raised during the company’s initial public offering. NewLake acquired two properties from a leading publicly-traded U.S. multi-state cannabis operator and amended its existing lease with another leading publicly-traded U.S. MSO to fund an already completed expansion. As of June 30, 2022, NewLake has approximately $28.7 million of unfunded commitments. Read more here.
TPCO Holding Corp., Curio Wellness
TPCO Holding Corp. (NEO: GRAM.U) (OTCQX: GRAMF), a consumer-focused California cannabis company, today announced that it has entered into an exclusive brand licensing and cultivation and production agreement with Curio Wellness, to bring the company’s brands and top-quality products to the State of Maryland, with anticipated market launch in late 2022. Read more here.
Rocky Mountain High Brands, Inc.
Rocky Mountain High Brands, Inc. (OTC: RMHB) today announced the launch of Rocky Mountain NexBev, Inc. a wholly owned subsidiary specializing in cannabis beverages. NexBev will work to ensure CBD Life Mexico S.A. de C.V. has product and build RMHB’s HEMPd brand by utilizing a strong network of cannabis co-packers throughout the United States. Read more here.