As Cannabis Industry Grows, So Do the M & A Numbers
Growing Cannabis
No, this isn't a technical article about just how to better grow cannabis, or a new hydro system. The marijuana 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 United States, the stigma on the industry is diminishing, and the industry is growing. A look at the stock prices for Tilray, Canopy, Aurora as well as others on the Canadian Stock Markets can tell you all you need to understand these days regarding the development as well as trajectory of the industry.
Mergers & Acquisitions
Certainly, as the industry grows, larger players in the marijuana market, and also outsiders, will be coming in to obtain companies across the cannabis industry. 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 potential partners in numerous markets across the United States for acquisition. Nonetheless, there are likewise internal industry mergers taking place too. Today it was announced that MedMen has acquired PharmaCann for $682 Million bucks in an all stock deal. (https://mjbizdaily.com/medmen-inks-blockbuster-682-million-stock-deal-to-acquire- medical-cannabis-firm-pharmacann/) PharmaCann was a significant player in the marketplace, owning provisioning centers, processing facilities and grows in numerous States, including Michigan. To date, this is the largest inside the industry merger as well as acquisition deal yet. Expect this to continue at a fast pace as more States legalize medical and also recreational marijuana.
Day-to-day Impact
For the single location provisioning center, this news might not seem like much of anything. However, everybody ought to focus. As these mergers as well as acquisitions continue, the impact will certainly trickle down to the smaller sized, single State or solitary location players. The key to long term survival and making certain the best possibility of benefiting from a future merger or acquisition possibility: become part of a vertical integration chain.
To do that, you need to have the appropriate connections and industry know how to connect with processors, growers, labs and transporters that can collaborate, with contractual guarantees as well as obligations. If that interests you, we can aid. Give our office a call
as well as set up a meeting to go over all of your choices.
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