It’s time for your Daily Hit of cannabis financial news for October 17, 2018.
Move over 420, because 1017 is the new cannabis holiday. Today marked the first day of legal adult use cannabis sales in Canada and it was well discussed on the GMR website.
On The Site
Prohibition Has Ended
It’s been gracing the front of almost every newspaper, on the tongues of this year’s political candidates, and becoming the topic of choice around the water cooler: The end of cannabis prohibition in Canada has finally come.
Canada is now the first G7 country to legalize cannabis on the federal level, making it legal to sell cannabis across the country to adults over the age of 19 (or 18 in Quebec and Alberta).
Lessons To Learn on Pricing
As Canada launches its adult use cannabis sales, the focus from investors has been on production size and facilities. Canadian cannabis companies have been racing each other to claim the crown as the biggest producer with the largest facilities and greatest yields. The industry north of the border has seemed to ignore the lessons already learned in the U.S. when there is a race to produce more than is needed.
Acreage Holdings is expected to invite former Prime Minister of Canada Brian Mulroney to be on the company’s Board of Directors following the company’s reverse takeover according to a report from The Globe and Mail. Last month, Acreage announced a plan to go public by entering into a reverse takeover with Applied Inventions Management which is expected to close in November. The stock will be traded on the Canadian Securities Exchange.
Should Mr. Mulroney accept the position, he will join former Speaker of the House John Boehner, former Massachusetts Governor Bill Weld, former Chairman and CEO of tw telecom Larissa Herda and former IBM CFO Douglas Maine.
In Other News
Sunniva Inc. (SNNVF) has signed a non-arms length binding letter of intent dated October 16, 2018, with the Oakland Vision Project to acquire all the issued and outstanding equity interests of the companies that comprise Vision. Vision is co-owned by Vinayak Shastry, Sunniva’s President of US Operations. Vision operates a licensed cultivation facility located in Irvine, California. Completion of the acquisition remains subject to a number of conditions including, among other things: the negotiation and execution of a definitive agreement between Sunniva and Vision, completion of due diligence and receipt of regulatory approvals, including approval of the Canadian Securities Exchange.
Organigram Holdings Inc.
Organigram Holdings Inc. (OGRMF) executed an investment agreement dated as of October 10, 2018, with alpha-cannabis Pharma GmbH pursuant to which the purchaser will acquire 8,333 common shares of ACG, representing a 25% stake in the capital of ACG, for aggregate proceeds of €1,625,000. The closing is subject to certain formalities under German law largely of an administrative nature.