In this week's "Rising High," The Fly's recurring series focused on cannabis and psychedelic stock news, The Fly looks back on a divestment, an acquisition and a marketplace launch.
CANOPY GROWTH TO DIVEST CANADIAN RETAIL OPERATIONS: Canopy Growth Corporation (CGC) announced Tuesday that the company has entered into agreements to divest its retail business across Canada which includes the stores operating under the Tweed and Tokyo Smoke retail banners. The company said, “The announcement reinforces the company's focus on advancing its path to profitability as a premium brand-focused cannabis and consumer packaged goods company.” The company has reached an agreement with OEG Retail Cannabis, an existing Canopy Growth licensee partner that currently owns and operates the company's franchised Tokyo Smoke stores in Ontario. As part of this agreement, OEGRC has agreed to acquire all of Canopy Growth's corporate stores outside of Alberta as well as all Tokyo Smoke-related intellectual property. The company has also reached an agreement with 420 Investments pursuant to which FOUR20 has agreed to acquire the ownership of five retail locations in Alberta. Closing of the OEGRC Transaction and the FOUR20 Transaction is subject to regulatory approvals and other customary closing conditions. Operational savings realized through these transactions are expected to result in Canopy's projected selling, general, and administrative cost savings being closer to the high end of the annualized target range expected as part of the cost reduction actions announced on April 26.
HIGH TIDE TO ACQUIRE JIMMY’S CANNABIS SHOP: High Tide (HITI) announced Thursday that it had entered into a definitive agreement pursuant to which it will acquire 100% of the equity interest of 1171882 B.C., operating as Jimmy's Cannabis Shop BC, as well as assignments of the vendors' shareholder loans, resulting in High Tide's acquisition of two of the five retail cannabis stores currently operated by Jimmy's in British Columbia for $5.3M. The stores are located at 1225 Cranbrook Street North, Cranbrook and 1543 Victoria Street, Prince George. For the trailing four months ended May 31, 2022, the stores generated annualized revenue of $5.4M and annualized Adjusted EBITDA of $1M. The purchase price represents 5.25x annualized Adjusted EBITDA for the trailing four months ended May 31, 2022. The transaction, which is an arm's length transaction, is subject to, among other things, receipt of the required approvals from the TSX Venture Exchange and the Liquor and Cannabis Regulation B, and the satisfaction of other customary conditions of closing, and is expected to close in the coming weeks.
ENTOURAGE LAUNCHES SYNDICATE MEDICAL CANNABIS MARKETPLACE: Entourage Health (ETRGF) announced Tuesday the launch of Syndicate, a direct-to-patient medical cannabis marketplace showcasing a portfolio of premium craft cannabis products sourced both in-house and from third-party micro-cultivators and producers. The company said, “Syndicate complements the company’s popular medical platform Starseed Medicinal which specializes as a medical cannabis provider to clients with insurance benefits coverage. With Syndicate, patients without insurance coverage can access a comprehensive catalogue of cannabis products, formats, and brands at a competitive price point. A unique model that offers an assortment of products from various producers, including partnerships with Greenseal Cannabis, Sitka Micro, Premium 5 and QWest Cannabis; a collective of micro-cultivators looking to distribute small-batch brands into the medical channel.” Canadian medical patients in Ontario can now register as Syndicate patients.
PLANET 13 RECEIVES EXPANSION APPROVALS: Planet 13 Holdings (PLNHF) announced Monday the receipt of the necessary approvals to operate its 22,000 square foot Nevada cultivation expansion and the planting of the first harvest from new grow rooms ahead of the previously forecasted timeline of Q4 2022. "We are thrilled to be able to expand our supply of premium quality flower for our popular Medizin, TRENDI, and Leaf & Vine flower lines. The expanded cultivation will also support our TRENDI vape and concentrates and HaHa edibles which are among the top selling brands in their respective categories in Nevada," said Larry Scheffler, Co-CEO of Planet 13.
GREENLANE SELLS HQ BUILDING: Greenlane Holdings (GNLN) announced Thursday the sale of its company headquarters building at 1095 Broken Sound Parkway, Boca Raton, Florida. The sale is in accordance with Greenlane's previously announced liquidity plan. The building was sold for $9,950,000 and closed on September 22, 2022. Greenlane operations will remain in the same building and the company will be transitioning its space to Suite 100.
CANNABIS/PSYCHEDELIC STOCKS: Publicly-traded companies in the space include Acreage (ACRHF), Akerna (KERN), Aleafia (ALEAF), Atai Life Sciences (ATAI), Audacious (AUSAF), Aurora Cannabis (ACB), Awakn Life Sciences (AWKNF), Ayr Wellness (AYRWF), Body and Mind (BMMJ), Cannara Biotech (LOVFF), Chicago Atlantic (REFI), Clever Leaves (CLVR), Columbia Care (CCHWF), Compass Pathways (CMPS), CordovaCann (LVRLF), Cresco Labs (CRLBF), Cronos (CRON), Curaleaf (CURLF), CURE Pharmaceutical (CURR), CV Sciences (CVSI), Delic Holdings (DELCF), Delta 9 (DLTNF), Fire & Flower (FFLWF), Flora Growth (FLGC), General Cannabis (CANN), Goodness Growth (GDNSF), Green Thumb (GTBIF), GrowGeneration (GRWG), Hemp (HEMP), HEXO (HEXO), India Globalization Capital (IGC), Indiva (NDVAF), Innovative Industrial Properties (IIPR), InterCure (INCR), IM Cannabis (IMCC), Wellbeing Digital (KONEF), Khiron Life Sciences (KHRNF), Lowell Farms (LOWLF), Lotus Ventures (LTTSF), MediPharm Labs (MEDIF), MedMen (MMNFF), Neptune Wellness (NEPT), NewLake Capital (NLCP), Thermic Science (ENDO), Organigram (OGI), Revitalist (RVLWF), RIV Capital (CNPOF), Relmada (RLMD), RYAH Group (RYAHF), Sproutly (SRUTF), Stem Holdings (STMH), Small Pharma (DMTTF), Skye Biosciences (SKYE), SNDL (SNDL), Sunniva (SNNVF), TerrAscend (TRSSF), Tetra Bio-Pharma (TBPMF), Tilray (TLRY), Trulieve (TCNNF), Tryp Therapeutics (TRYPF), The Valens Company (VLNS), Verano Holdings (VRNOF), Village Farms (VFF), Wesana Health (WSNAF), Zynerba (ZYNE) and 4Front Ventures (FFNTF).