As Cannabis Industry Grows, So Do the M & A Numbers
Growing Cannabis
No, this isn't a technical article about how to better grow cannabis, or a new hydro system. The cannabis industry is proliferating. With legalization in Canada taking full effect on October 15, 2018, as well as a lot more cannabis legalization measures on ballots throughout the USA, the stigma on the industry is diminishing, and the industry is growing. A look at the stock prices for Tilray, Canopy, Aurora and others on the Canadian Stock Markets can tell you all you need to know these days concerning the growth as well as trajectory of the industry.
Mergers & Acquisitions
Obviously, as the industry grows, larger players in the marijuana market, and outsiders, will be coming in to acquire companies across the marijuana market. In recent days, Constellation Brands (the parent Company of Corona and Modelo Beers), obtained a part of Canopy for 5.4 Billion Dollars. Cigarette manufacturers are seeking prospective partners in various markets across the United States for acquisition. Nonetheless, there are also inner industry mergers happening as well. Today it was introduced that MedMen has actually bought PharmaCann for $682 Million dollars in an all stock bargain. (https://mjbizdaily.com/medmen-inks-blockbuster-682-million-stock-deal-to-acquire- medical-cannabis-firm-pharmacann/) PharmaCann was a considerable player in the markets, having provisioning centers, processing facilities and also grows in numerous States, including Michigan. To date, this is the largest inside the industry merger and also acquisition deal yet. Anticipate this to continue at a fast pace as more States legalize medical as well as recreational cannabis.
Everyday Impact
For the single location provisioning center, this news may not appear like much of anything. Nevertheless, everyone ought to take note. As these mergers as well as acquisitions continue, the impact will certainly trickle down to the smaller, solitary State or solitary location players. The key to long term survival and making sure the best opportunity of profiting from a future merger or acquisition chance: enter into a vertical integration chain.
To do that, you need to have the ideal connections as well as industry know how to connect with processors, growers, labs and also transporters who can work together, with legal guarantees as well as obligations. If that interests you, we can aid. Give our office a call
and set up a meeting to talk about all of your options.
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