It’s time for your Daily Hit of cannabis financial news for August 21, 2018.
On The Site
Constellation Brands’ (STZ) investment in Canopy Growth Corp. (CGC) of 104.5 million shares was based on “a big speculative bet on marijuana”, according to Moody Corporation’s Senior Vice President Linda Montag.
Montag wrote in her report, “There is significant uncertainty around the ultimate demand for cannabis and its derivative products, including cannabis-infused beverages. Legalization in many markets, including the US, also remains uncertain, as does pricing and regulatory dynamics in markets that have legalized. Potential liabilities or litigation could also arise.” The investment is the largest of the cannabis industry so far.
Asset manager BlackRock Inc. is now the biggest institutional holder of 22nd Century Group Inc. (XXII), a company that claims to be specializing in cannabis, but is really only a producer of tobacco products.
BlackRock Inc. filed a 13F-HR form disclosing ownership of 7,361,866 shares of 22nd Century with total holdings valued at $18,110,000 USD as of June 30, 2018. BlackRock Inc. had filed a previous 13F-HR on May 09, 2018 disclosing 2,809,955 shares of 22nd Century Group, Inc. at a value of $6,602,000 USD. This represents a change in shares of 161.99 percent and a change in value of 174% during the quarter.
The Green Organic Dutchman
Green Organic Dutchman Holdings Ltd. (TGODF) signed a definitive agreement to acquire 100% of the issued and outstanding shares of privately-held HemPoland in an immediately accretive cash and share transaction.
HemPoland is a leading European manufacturer and marketer of premium organic CBD oils led by founder and CEO, Maciej Kowalski, one of Europe’s most widely recognized CBD experts. TGOD’s goal in the acquisition is to get access to HemPoland’s vast distribution network, premium Cannabigold brand, hemp oil extraction technologies, and get a jump into the European market for TGOD’s medical & recreational products and licensing deals.
The deal will cost of US$7.75 million in cash and 1,968,323 restricted TGOD shares currently worth US$7.75 million with an additional US$10.3 million cash investment for rapid European expansion. In addition to that, there are performance-based incentives of up to US$12 million for delivery of US$32 million of EBITDA in fiscal 2021.
In Other News
Kaya Holdings, Inc.
Kaya Holdings, Inc. (KAYS), filed its quarterly report after close of market yesterday afternoon. The company had revenues of $291,133 for the three months ended June 30, 2018, as compared to revenues of $ 199,790 for the three months ended March 31, 2017, and revenues of $546,498 for the six months ended June 30, 2018, as compared to revenues of $ 344,651 for the six months ended March 31, 2017. That’s a 45% year-over-year increase in revenues for Q-2 of 2018 versus 2017, and a nearly 60% year-over-year increase in revenues for the first six months of 2018 versus the same period of 2017.
The increase is largely due to the fact that in 2017 the Portland Store was unable to process recreational sales for the first quarter due to a delay in receiving the Portland City Licensing. As a result, revenues from legal recreational sales were largely generated from retail sales at one outlet during most of the 2017 period, as compared to three outlets in the comparable period in 2018. All four of the Company’s retail locations have now received full OLCC licensing.
SinglePoint Inc. (SING) announced its status as a fully reporting company by way of filing Form 10-12G and reports year-over-year improvements for the second quarter and six months ended June 30, 2018. Second-quarter revenues increased nearly 100% compared to the same quarter of 2017. In the first six months of 2018, SinglePoint recorded over $500,000 in revenue as a result of several successful acquisitions. The company hopes to maintain this growth trend through its current business model.
GB Sciences, Inc.
GB Sciences, Inc. (GBLX) and the LSU Agricultural Center (LSU AgCenter), have now commenced operation in the environmentally controlled grow pod. The first plants in production were developed through tissue culture propagation to ensure genetic consistency. Once operating at full capacity, the facility will have plants at staggered stages of growth, enabling a continuous harvesting cycle that will provide the raw material for Louisiana’s therapeutic cannabis program. Final formulations are expected to be available in November of this year.
Kush Bottles, Inc.
Kush Bottles, Inc.(KSHB) announced the opening of two new hazmat operating facilities strategically located in the Portland, OR and Seattle, WA metropolitan areas, operating under Kush Energy, a division of Kush Bottles. These facilities will focus on supplying customers in these regions with tested, high quality solvents and hydrocarbons which are essential in the cannabis extraction process for the production of items including oils, edibles and waxes.
GSRX Industries Inc.
GSRX Industries Inc. (GSRX) announced that it has received a Certificate of Occupancy from the Puerto Rico Office of Permit Management for its newest Green Spirit RX pre-qualified medicinal cannabis dispensary location in Puerto Rico.
CLS Holdings USA, Inc.
CLS Holdings USA, Inc. (CLSH) announced that Matthew Janz has joined the Company as VP of Marketing and Director of Operations at Oasis Cannabis.