Canadian Cannabis Growing With Major Outside Investments

The Canadian cannabis market is projected to be a $9 billion industry when recreational use becomes legal there in July 2018. A number of recent outside investments from the alcohol, tobacco, and pharmaceutical industries might make that market even larger.

Investment from beer distributor Constellation Brands, Inc., who produce the Corona and Modelo beer, has propped up marijuana company Canopy Growth with a CAD$245 million investment that bought them nearly ten percent of the company. That investment, announced in late October, has led to speculation that Canopy Growth and Constellation will team up to distribute cannabis-infused beverages through Constellation’s formidable distribution arm.     

Canopy has also teamed up with Delta 9 Growth to expand into the Manitoba market.

In a move that may raise as much as CAD$50 million, Canadian cultivator and distributor Aurora Cannabis has accelerated the expiry date on many of their common shares. The company is also adding an 800,000-square foot production facility in Edmonton, in addition to the 55,200-square-foot facility in Alberta and a 40,000-square-foot facility in Quebec.

"The ability to accelerate the expiry of these warrants is an indicator of Aurora's powerful growth and increase in shareholder value," the company’s CEO Terry Booth said in a release. "It adds significant additional capital to our exceptional cash position, with which we intend to continue our aggressive domestic and international expansion strategy."

Cannabis producer Aphria has U.S. expansion plans, and to that end sold $13 million stock shares valued at C$92 million. They’ve entered a strategic investment agreement with DFMMJ Investment Ltd. to manage and acquire U.S. cannabis brands.

Producer ABcann also saw its stock price more than double thus far in the fourth quarter of 2017 and announced two new production facilities.

"ABcann's first quarter as a publicly traded issuer was a successful one, leading to the company having over $40 million in current working capital," the company announced. "With our strong cash position, ABcann expects to significantly increase production capacity in 2018 while pursuing our aggressive construction and expansion timelines at both Vanluven and Kimmett."

Add comment