Jetting Ahead – Canopy Rivers Lists on TSX and Cronos Acquires Redwood Subsidiaries

Canopy lists on the TSX, Valens releases revenue guidance, Cronos closes Redwood acquisition, and more!

It was a groundbreaking week for Canopy Rivers Inc (OTC: CNPOF)—a venture capital firm specializing in cannabis—after the company announced that its class A subordinated voting shares will begin trading on the Toronto Stock Exchange under the ticker symbol "RIV".

This milestone was achieved within less than one year of Canopy Rivers' initial go-public transaction. No further action is required by existing shareholders. The company will participate in the TSX market open ceremony on September 24.

"We are proud to join a class of issuers that includes many reputable domestic and international companies. We believe that graduating to the TSX will improve awareness about Canopy Rivers and enhance liquidity for our shareholders and other market participants." President and CEO of Canopy Rivers, Narbe Alexandrian

The company also announced the formation of its Strategic Advisory Board, a group of respected business leaders that will provide guidance to Canopy Rivers' executive team as it continues to build and strengthen the company's global portfolio of leading cannabis companies.

Inaugural members of Canopy Rivers' Strategic Advisory Board  will include the co-founder and Vice Chair of the Council of Canadian Innovators, John Ruffolo.

Also joining him will be Philip Donne—a board advisor for several companies including Greenhouse Juice, Longo's, Nature's Path Foods, and Valens GroWorks—and the co-Head of M&A and Corporate and Commercial Counsel for Imperial Brands PLC, Meg Lovell.

Canopy Rivers CEO Narbé Alexandrian discusses the company's investment approach.

Sunniva Inc (CSE:SNN) announced that it has entered into a share purchase agreement with The Clinic Network Canada Inc, dated September 10, 2019. Pursuant to which, Sunniva has agreed to sell Natural Health Services (NHS) for CAD $9.0 million, subject to customary working capital adjustments at closing.

The purchase price will be paid by way of CAD $4.5 million in cash and CAD $4.5 million of security consideration through the issuance of 4,500,000 preferred shares of TCNC. Closing is anticipated to occur in the fourth quarter of 2019.

NHS operates 7 medical cannabis clinics in Alberta, Saskatchewan, Manitoba and Ontario with dedicated physicians with an additional 10 clinics participating in its Affiliate clinic programs across Canada.

"The sale of NHS to TCNC will complete the previously announced disposition of our Canadian operating assets and is in line with our previously announced strategy of focusing on the advancement of our California assets and expanding our sales and distribution infrastructure within the state." CEO of Sunniva Inc, Dr. Anthony Holler

High Tide Inc (CSE:HITI) announced that the Canna Cabana retail stores located in Unit #610 at 20 Crowfoot Crescent NW in Calgary and at 4806 50 Avenue in Vegreville  both received their first deliveries of cannabis products from Alberta Gaming, Liquor and Cannabis and have begun selling recreational cannabis for adult use.

Grand opening festivities will be held at each of the new stores on Saturday, September 7. The company currently has 23 branded Canna Cabana locations selling recreation cannabis products across Canada, inclusive of the new stores.

High Tide's next Canna Cabana location is licensed and expected to be operating as a retail cannabis store by mid-September. With the opening of the first KushBar location in the coming weeks, the company will soon have 25 branded retail cannabis locations across Canada, barring any changes to the current rate of licensing by AGLC.

"Our company continues to execute on its growth plans by adding a great location in northwest Calgary while expanding into the new market of Vegreville." President and Chief Executive Officer of High Tide, Raj Grover.

Valens GroWorks Corp (TSXV: VGW) announced revenue guidance for the recently completed third quarter 2019 in the range of $16 million – $17 million, a significant increase over its second-quarter 2019 revenue of $8.8 million.

The company expects to report that it has extracted over 26,000 kilograms of cannabis and hemp biomass in the third quarter of 2019.

This represents a significant ramp in extraction volumes compared with the 8,547 kilograms of dried cannabis and hemp biomass it processed in the second quarter of 2019, driven by the build-out of the company's ethanol extraction capabilities and increasing volumes from our new and existing customers.

Valens GroWorks President Jeff Fallows outlines the company's strong Q2 2019 numbers.

Cronos Group Inc (NASDAQ: CRON) announced that it had closed its previously announced acquisition of four Redwood Holding Group, LLC operating subsidiaries.

The transaction provides Cronos Group with a leading U.S. hemp-based products platform, including hemp-derived cannabidiol (CBD) infused skincare and other consumer products that are sold online and through retail and hospitality partner channels in the United States under the brand, Lord Jones.

"This acquisition is one of a number of new growth opportunities that is differentiating our company and our strategic direction. We are pleased to have completed this acquisition and look forward to working closely with Rob and Cindy to further build on their record of innovation and fully capitalize on the platform they have created." Cronos Chairman, President and Chief Executive Officer, Mike Gorenstein.

MedMen Enterprises (CSE: MMEN) announced that the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 has expired with respect to the proposed acquisition of PharmaCann, LLC.

The expiration of the waiting period under the HSR Act satisfies one condition needed to close the transaction, which is expected to be completed by the end of calendar year 2019, subject to customary closing conditions.

As consideration for the transaction, PharmaCann shareholders are expected to receive approximately 168.4 million shares in the combined company, based on MedMen's fully-diluted shares outstanding as of June 29, 2019. The total share consideration is subject to change based on the company's fully-diluted shares outstanding as of the closing date of the transaction.

"MedMen has built an enviable footprint which has cemented our brand in the largest cannabis markets in the world. Our transformative acquisition of PharmaCann will mould us into an even bigger and bolder company for our consumers. This acquisition doubles the number of states where MedMen has licenses, extending our geographic footprint and creating tremendous opportunity for our company and our shareholders. We are excited to be one step closer to closing the acquisition." MedMen Co-Founder and CEO, Adam Bierman

Finally, Aurora Cannabis (TSX: ACB) announced its financial and operational results for the fourth quarter and fiscal year ending June 30, 2019.

Net cannabis revenue was up 61% sequentially to $94.6 million, while cash cost to produce per gram sold declined 20% sequentially to $1.14 per gram. Gross margin on cannabis net revenue increased by 3% to 58% and Aurora's medical patient base expanded 10% to 84,729.

The company also closed an amended and upsized $360 million secured credit facility and sold its remaining 28,833,334 shares of The Green Organic Dutchman Holdings Ltd—at a price of $3.00 per share—during this period.

"In 2019 Aurora took its place as the global leader in cannabis production, research, innovation, and international market development. We are executing on all our strategic priorities." – CEO of Aurora, Terry Booth

Aurora also closed its previously announced amended and upsized credit facilities with a syndicate of lenders led by the Bank of Montreal.

The facilities consist of an additional C$160 million in term loans, as well as an accordion feature that enables Aurora to upsize the facility by approximately C$40 million, in addition to the original C$200 million in credit facilities all of which mature in 2021.

The credit facilities will have a first ranking general security interest in the assets of Aurora and can be repaid without penalty at Aurora's discretion.

Aurora Cannabis CCO Cam Battley discusses Aurora Sun, the company's latest production facility.

Watch this space for future updates.

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Hugo Gray
Hugo Gray

Hugo Gray is a Melbourne-based journalist with a body of work that covers a diverse range of topics, including immigration law, sex technology, and now the rapidly expanding cannabis industry.

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