Financialnewsmedia.com News Commentary
Attention surrounding the cannabis market continues to be accentuated by the industry's astonishing growth rate as it continues to flourish in light of legalization across the globe and now, major tobacco focusing on cannabis opportunities. Shares of Canada's Cronos Corp. rocketed more than 24% Friday, after Altria Group Inc. agreed to take a major stake in the company and become its exclusive partner in the cannabis sector as new markets for medical and recreational weed open around the world. Wells Fargo analyst Bonnie Herzog said the news was 'very positive' as it expands Altria's total addressable market. "Overall, we applaud MO's decision to pivot fast and to move into cannabis grow operations that is complimentary to its core tobacco business," she said, reiterating her outperform rating on Altria stock. Revenues in Canada have already been outpacing projections for 2018 and optimism for continued progress in the United States is abundant as more states vote for legalized cannabis, be it recreational or medicinal. Active companies in the industry making moves to ready that include: Choom(TM) Holdings Inc. (CSE:CHOO) (OTC:CHOOF), Aurora Cannabis Inc. (NYSE:ACB) (TSX:ACB), MedMen Enterprises Inc. (CSE:MMEN.CN) (OTC:MMNFF), National Access Clinic Corp. (TSX-V:META.V), Altria Group Inc. (NYSE:MO).
Choom(TM) Holdings Inc. (CSE:CHOO) (OTCQB:CHOOF) BREAKING NEWS: Choom(TM), an emerging adult use cannabis company that has secured one of the largest national retail networks in Canada, is pleased to announce two executive additions to the recently-formed Ontario Retail Team: Lamar Hanna as Senior Vice President Retail, Ontario and David Schenk, Regional Operations Manager, Ontario. Choom is also pleased to announce an update of its Ontario retail strategy in which 90 offers to lease are currently under negotiation, with 20 leases secured.
Chris Bogart, President & CEO states, "The private retail market in Ontario provides the greatest opportunity across Canada for cannabis retailers. This channel in Ontario is poised to be larger than all the other private cannabis retail channels in Canada combined. The additions of Dr. Hanna and Mr. Schenk will bolster the Choom team by bringing retail operations experience from the highly regulated retail pharmaceutical and cannabis clinic industries. As we approach the opening of the Ontario application portal in December, securing locations, building stores, and developing a team remains our top priorities. With their knowledge and best practices in the retail of controlled substances, Dr. Hanna and Mr. Schenk will greatly expedite Choom's retail strategy in Ontario."
Choom's National Retail Network
Choom is currently developing a network of retail stores which will feature a curated selection of products from various licensed producers with a strong focus on elevated customer experiences for the adult use market. In Ontario, Choom currently has 90 offers to lease under negation with 20 leases secured in preparation for the application portal opening December 17, 2018. Choom is on track to having the maximum allowable of 75 applications in Ontario and is rapidly working towards the April 2019 deadline when Ontario's private retail channels are expected to come online.
Additionally, Choom has secured the rights to 68 retail opportunities across Western Canada, rapidly expanding their commercial footprint presence in highly strategic locations. This includes a total of 50 applications submitted, with 35 development permits received from the various municipalities. In Western Canada, 10 stores are currently under construction with an additional 7 stores having completed their build out. Read this and more news for Choom(TM) at: https://www.financialnewsmedia.com/news-choo/
Additional industry related developments from around the markets:
Aurora Cannabis Inc. (NYSE:ACB) (TSX:ACB) recently announced plans to establish a foothold in Mexico through the acquisition of Farmacias Magistrales. The deal announcement comes less than one week after Aurora announced an exclusive supply agreement with Farmacias Magistrales. Canada-based Aurora Cannabis will acquire Farmacias Magistrales SA through an all-stock deal. The exact value of the deal was not announced. The acquisition follows an agreement between Aurora Cannabis and Farmacias that calls for Aurora to supply the Mexican company with medical cannabis. Prior to that, Farmacias Magistrales received the first and only import license for medical marijuana in the country.
MedMen Enterprises Inc. (CSE:MMEN.CN) (OTCQX:MMNFF) recently announced it has closed the acquisition process of Omaha Management Services, LLC's Monarch Dispensary. Omaha Management Services, a subsidiary of WhiteStar Solutions LLC, operated the Monarch Dispensary which happened to be the first cannabis dispensary of its kind in Scottsdale, Arizona. According to the terms of the agreement, MedMen will assume possession of Whitestar's co-manufacturing and licensing agreement with "Kiva, Mirth Provisions and HUXTON for the state of Arizona." The Monarch Dispensary which held a cannabis license issued by the state of Arizona and operated a cannabis cultivation and processing facility will be instrumental in introducing MedMen into the lucrative cannabis market. The acquisition deal was settled in 80% equity and 20% cash. Adam Bierman, MedMen's CEO and Co-Founder commenting about the finalized acquisition agreement said, "As we look to operationalize the acquisitions we have made in recent months, our team has focused on timely and seamless transitions." The company's boss boasted about the exemplary efforts his team put up to close the deal in record time and get the newly acquired business operational.
National Access Clinic Corp. (TSX-V:META.V) recently announced a corporate and retail sales update. The Company achieved $3 million in cumulative sales in its first 43 days of retail operation and $3.95 million in its first 50 days. The average gross margin achieved over the first 50 days of operation of retail locations was over 30 per cent, with consumable cannabis making up 94 per cent of total sales. NAC is currently the largest private cannabis retail operator in the country and has plans to open up to 75 retail cannabis locations in Ontario over the next 18 months, subject to regulatory approval, along with continued growth in other areas of the country.
Altria Group Inc. (NYSE:MO) last week announced that it has entered into an agreement to acquire newly issued shares in Cronos Group Inc., a leading global cannabinoid company, headquartered in Toronto, Canada. The transaction represents a 45% equity stake in Cronos Group, at a price of CAD $16.25 per share, for an aggregate investment by Altria of approximately USD $1.8 billion (approximately CAD $2.4 billion). As part of the agreement, at closing, Altria will have the right to nominate four directors, including one independent director, to serve on Cronos Group's Board of Directors, which will be expanded from five to seven directors. The agreement includes a warrant to acquire an additional ownership interest in Cronos Group at a price of CAD $19.00 per share exercisable over four years from the closing date. If exercised in full, the warrant would increase Altria's ownership in Cronos Group by 10% to approximately 55%.
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