This was not the best of weeks for the cannabis industry, with a few deals falling through the cracks and a couple execs leaving their companies. Aphria Inc /zigman2/quotes/207425803/composite APHA +3.10% tumbled Wednesday after rejecting Green Growth Brands Inc /zigman2/quotes/204912440/delayed GGBXF +5.06% 's hostile takeover bid.
On the other hand, Argentina’s government authorized the country’s first medical cannabis grow operation, half owned by Aphria, in a move that bodes well for the company and other players with investments in Latin America.
In other Latin American news, we learned that Colombia is set to begin exporting cannabis to Canada, following the granting of an export permit to Clever Leaves.
“We've seen several relationships within the cannabis industry blow up over the past two weeks. Between Namaste Technologies’ termination of its CEO, the lawsuit from MedMen's CFO and then FDS Pharma and Auxly ending their agreement — it's been a bad week for the industry," Green Market Report CEO Debra Borchardt told Benzinga.
“What has been striking about these divorces is the amount of vitriol in the lawsuits and the nastiness in the press releases,” she said. “In more traditional industries, you never see the dirty laundry being aired like this. These types of disagreements are unfortunate because they give the industry a black mark, but it also serves as a warning to future companies planning joint ventures.”
With the earnings season just around the corner, check out this story on what to expect from the main companies in the space by Benzinga’s Alex Oleinic.
Over the last five trading days, the United States Marijuana Index, which tracks most of the largest marijuana stocks in the U.S., lost roughly 6.6 percent, while the North American Marijuana Index, which also includes Canadian stocks, lost approximately 8.3 percent.
Over the same period, the Horizons Marijuana Life Sciences Index ETF /zigman2/quotes/200444869/delayed HMLSF +1.36% /zigman2/quotes/208856346/delayed CA:HMMJ +1.03% dropped 3.6 percent, while the ETFMG Alternative Harvest ETF /zigman2/quotes/204332491/composite MJ +0.70% lost roughly 4.35 percent. The SPDR S&P 500 ETF Trust /zigman2/quotes/209901640/composite SPY -0.18% closed the period down about 0.2 percent.
The top marijuana stocks (market cap above $300 million) trading on U.S. exchanges performed as follows over the last five trading days:
Following the controversy around CBS Corporation ’s rejection of a pro-cannabis legalization TV ad that Acreage Holdings intended to run during the Super Bowl, Forbes reported a marijuana-related ad did air during the grand football event.
The caveat: the ad was aired on CBS TV 2 Virgin Islands, a CBS affiliate in the U.S. Virgin Islands owned by Innovative Communications Corporation — and not the NYSE-traded media behemoth. Last year, Benzinga reported on this same ad, from 420MEDIA, being aired during primetime programming on BRAVO, Discovery and the History Channel in the greater Los Angeles market.
The spot in question featurs Senator Positive T.A. Nelson, a seven-term senator from the island of St. Croix, discussing the science and economic power of medical cannabis. See his reaction as the ad aired during the Super Bowl below.
Helix TCS Inc /zigman2/quotes/202671877/delayed HLIX +0.71% completed the acquisition of Amercanex International Exchange, one of the first cannabis electronic trading platforms in the legal cannabis industry. Building on its recent merger with BioTrackTHC in 2018 and Cannabase in 2016, the acquisition further expands Helix TCS’ Critical Infrastructure Services Platform. This platform enables new and already operating cannabis businesses, as well as ancillaries and governments, to manage mission critical infrastructure in their supply chain, inventory and compliance functions.
“Due to the unique compliance requirements in each regulated cannabis market, providing a compliant exchange marketplace is an extremely complex endeavor. The acquisition of Amercanex will let us deepen the unique suite of technology to enable real-time access to wholesale marketplaces on a global scale and to facilitate transactions between licensees in completely different regulatory environments in a compliant manner,” Helix TCS Executive Chairman and CEO Zachary Venegas told Benzinga.
Green Thumb Industries announced it has signed a definitive agreement to acquire For Success Holding Company, creator of the Los Angeles-based Beboe brand of cannabis products. Beboe products will expand beyond California and Colorado with distribution in select GTI markets.
Ben Kovler, GTI’s founder and CEO, told Benzinga: “Beboe is the perfect example of an authentic, visionary brand and is an excellent addition to GTI’s brand portfolio. We are thrilled to have the collective creative genius of Beboe founders Scott Campbell and Clement Kwan and their incredible team join the GTI family.”
Beboe co-founder Clement Kwan said that merging with GTI "gives us an incredible multistate platform and opportunity to fully grow Beboe and the slate of new brands, products and collaborations that we envisioned when starting For Success Holding.”
iAnthus Capital announced the closing of its acquisition of MPX Bioceutical, creating a combined company valued at CA$1.6 billion ($1.2 billion). The new entity becomes one of the world’s largest cannabis companies, operating in 11 U.S. states with a population of over 120 million people — and licenses to operate up to 63 dispensaries and 600,000 square feet of cultivation space.
“2019 will be a transformative year for iAnthus, with the closing of our business combination with MPX being a crucial step forward. As the U.S. cannabis market continues to expand with increasing consumer and regulatory acceptance, iAnthus will continue to execute and provide the quality products and brands that our customers demand. As demonstrated with our 2018 acquisitions in Florida and New York, and now with the closing of our MPX transaction, the iAnthus team continues to demonstrate its focus on growing its platform and operations,” said iAnthus CEO Hadley Ford.
Dixie Brands announced a strategic move into Michigan, which is one of the nation’s largest medical markets with 300,000 consumers and counting. As Michigan transitions into a legal, adult recreational market, consumers in the state will have access to Dixie Brand’s portfolio of more than 100 diverse products across 15 different categories, including edibles, tinctures, topicals and connoisseur-grade extractions.
This news comes on the heels of last week’s deal with Khiron Life Sciences to expand Dixie’s footprint into Latin America.
“Michigan is the first of several new U.S. states that Dixie will enter in 2019 as we execute our strategic North American expansion plan," said Chuck Smith, CEO and co-founder of Dixie Brands.
"Through our partnership with Choice Labs, the state’s first vertically integrated cannabis producer, Dixie will introduce its full portfolio of cannabis-infused products throughout the state beginning in March 2019."
Green Horizon had its official groundbreaking at the future home of Coachella Cann Park, a multipark facility for indoor cannabis cultivation, manufacturing and distribution. Green Horizon is a vertically integrated cannabis bioscience and holding company that's developing 472,000 square feet of indoor cultivation, light deprivation greenhouse, manufacturing and distribution capabilities in Coachella, California. Founded in 2016 by Michael Meade and Los Arias, Green Horizon will provide white labeling services for brands at scale, in addition to creating its own brands utilizing proprietary genetics.
“We are thrilled to begin developing this venture and are looking forward to leading the way in cannabis cultivation,” Meade told Benzinga.
Sonoma, California-based QVI announced it’s refitting an approved 8,300-square-foot facility in Santa Rosa with dedicated space for a large-scale commercial kitchen to produce baked goods, chocolate products and a hard candy and gummy line.
QVI’s goal is to become a premier contract manufacturer in California, the largest single market in North America. “The Galley plans to add to the Sonoma County experience by crafting exceptional cannabis products, as well as host cannabis tours and educational events — 'California Dreamin’' at it’s finest,” said co-founder Annie Holman.
In a partnership with the Kolas Group, Aster Farms’ pesticide-free cannabis is now available throughout Sacramento. “Kolas is revolutionizing the cannabis retail experience and we are very excited to be a part of education and provisions in Sacramento,” said Aster Farms President Sam Ludwig.
Canopy Rivers Inc /zigman2/quotes/201002551/delayed CNPOF +0.16% , the investment platform of Canopy Growth Corp., announced the completion of a $1- million financing in Canapar Corp, the Canadian parent corporation of Canapar SrL.
Italy-based Canapar SrL is a manufacturer and processor of CBD oil and isolates and is playing an important role in meeting the increasing demands of the European CBD and hemp markets. The company is also developing and commercializing CBD-infused cosmetics, skincare and beauty products for the Italian cosmetics market — the fourth-largest such market in Europe — and for the global market, which covets “made in Italy” brands.
“The Italian and European cannabis market landscape is undergoing dramatic change, and European demand for CBD has exploded based on the growing belief of CBD’s positive health effects. This investment allows Canopy Rivers through Canapar to capitalize on this untapped opportunity and penetrate one of the five largest cannabis markets in Europe,” said Canopy Rivers President Narbe Alexandrian.
Young America Capital, a licensed investment bank and broker-dealer, announced the successful brokerage of the assets of Green Meadows Wellness (dba Infinite Wellness Center), a vertically integrated cannabis company in Colorado. The company was purchased by LivWell Enlightened Health.
“We have an extensive network of investors in the cannabis industry which provides our clients with a number of options,” said Peter Formanek, the head of Young America Capital.
The legendary Willie Nelson and his family are debuting their take on better health and wellness through hemp with the official launch of the brand Willie’s Remedy and its first product: infused whole-bean coffee. The coffee is infused with certified organic, full-spectrum hemp oil grown in Colorado and is sourced from various smallholder farms in Colombia’s Santuario region.
The music icon and longtime U.S. farming activist leads the charge for putting American-grown hemp to good use with Willie’s Remedy, which will feature a range of non-intoxicating, hemp-based products designed for health-conscious consumers of all ages.
“Hemp production in America was stifled for so long, but it could now make all the difference for small independent farmers,” Nelson said. “Hemp isn’t just good for our farmers and our economy, it’s good for our soil, our environment — and our health.”
Nelson and his wife Annie made headlines in 2015 when they introduced the cannabis brand Willie’s Reserve, which taps a carefully selected network of state-licensed cultivators to provide the main ingredient for products sold in legal medical or adult-use cannabis markets.
“The Willie’s Remedy line is a purposeful departure from Willie’s Reserve,” Annie said. “it’s not about getting high, but it’s still all about Willie and the benefits we believe cannabis has to offer. Willie and I are proud to offer quality, American-sourced hemp wellness options for people of his generation, our kids’ generation and everyone in between.”