This is your Daily Hit of cannabis financial news for October 5, 2021.
On the Site
New York’s Cannabis Control Board is moving quickly to make up for the lost time under the previous administration. In the group’s first meeting since incoming Gov. Hochul stepped in and nominated people for the board, they approved raw cannabis flower as a medical product effective immediately. In addition to approving flower, the Board also loosened other restrictions.
- Doctors can approve medical patients
- 30 day supply increases to 60 day supply
- $50 registration fee for patients is waived
- Streamlining dispensation
Alimentation Couche-Tard (ACT) (OTC: ANCUF), the parent company of Circle K stores is continuing to cement its relationship with cannabis company Fire & Flower Holdings Corp. (TSX: FAF) (OTCQX: FFLWF). The two companies are expanding on a pilot program to open new Fire & Flower cannabis retail stores next to existing Circle K in markets across Canada. The original Circle K co-located store pilot program started in July 2020 with the first two stores, located in Calgary and Grand Prairie, Alberta. The company said that the expansion of the pilot program between the strategic partners will see new co-located retail stores open over the next several months in the Canadian provinces of Alberta, Saskatchewan, and Manitoba. The two companies said they expect to continue this strategy with sights set on Ontario and even the U.S.
Last week, Sundial Growers (OTC: SNDL) enjoyed some success in the courtroom when a case brought against the company by investors was dismissed. In May 2020, several investors had charged that Sundial made claims in investor presentations that weren’t true. However, U.S. District Judge Andrew L. Carter Jr. said that the various statements made in the presentations were either protected, forward-looking statements or weren’t all that misleading at the time the statements were made. The issue stems back to 2018 when Sundial tried to raise $50 million in order to buy an agricultural company based in the UK called Bridge Farm. According to the court filing, the January Investor Presentation said that Bridge Farm had a hemp license that would allow for cultivation, processing, and export of finished products from the UK. It went on to say that Bridge Farm would “provide a platform for scalable growth with only ~C$20 mm in incremental Capex needed to facilitate CBD production and extraction” and that the “[o]peration enables us to produce and distribute at scale almost immediately and more quickly than competitors.” At the time, Sundial said it expected Bridge Farm to generate C$256 million in revenue and C$115 million of EBITDA in 2020.
In Other News
Akerna Corp. (Nasdaq: KERN) announced it has entered into a securities purchase agreement for a US $20 million convertible debt financing with existing institutional investors who hold the Company’s currently outstanding convertible notes. The net proceeds from the issuance of the new senior secured convertible notes (the “Notes”) will be used to support Akerna’s ongoing growth initiatives and continued investment in current and future technology infrastructure.
urban-gro, Inc. (Nasdaq: UGRO) and XS Financial (CSE:XSF) (OTCQB: XSHLF) (“XSF”), a specialty finance company providing CAPEX financing solutions including equipment leasing to cannabis companies in the United States, have entered into a strategic agreement allowing for XS Financial to provide urban-gro clients with CAPEX leasing solutions and XSF customers with access to urban-gro’s vendors and enhanced purchasing power.