Coming Cannabis Recreational Demand in Canada Triggers Massive Investment

NEW YORKNovember 20, 2017 /PRNewswire/ —

The Canadian government’s commitment to legalize recreational cannabis in July 2018 is touted as an opportunity for investors to profit from the ongoing green blitz. Gearing up for the anticipated spike in consumer demand, cannabis-related businesses are lining up steady sources of supply from the country’s licensed producers (LPs). The alcohol and tobacco industries are also preparing to get their hands on the plush opportunities of legalized recreational cannabis. One of Canada’s earliest licensed cannabis producers, ABcann Global Corp. (OTC: ABCCF) (TSX.V: ABCN) (ABCCF Profile), is well-positioned to capitalize on the market’s expansion with its computer-controlled growing platform that helps it produce more than 250 grams of cannabis per square foot each year, placing it among the highest yields within the Canadian sector. Other licensed producers such as Aurora Cannabis, Inc.(OTC: ACBFF) (TSX: ACB)Canopy Growth Corp. (OTC: TWMJF) (TSX: WEED), Aphria, Inc. (OTC: APHQF) (TSX: APH) and Delta 9 Cannabis, Inc. (TSX.V: NINE), are also gearing up for what all agree will test the industry’s ability to keep up with demand.

ABcann Global (OTCQB: ABCCF) (TSX.V: ABCN), a manufacturer and distributor of medical cannabis within Canada, creates a consistent, organically grown, pesticide-free, standardized product that keeps costs down and its physician/patient base coming back. ABcann’s approach to growing cannabis centers on replicating the natural environment of any geographical location for a product that is both superior in quality and sustainable from batch to batch. The company’s yield per square foot is significant – 100 percent over the industry average – and the quality of its cannabis is a key factor in bringing customers back 94.7 percent of the time. Expansion plans are funded with some $43 millionin working capital raised through multiple financings and ground has already been broken on two facilities that will drastically increase production capacity in 2018.

“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 stated in a news release (http://nnw.fm/0B2pW). “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.”

One of the biggest shakeups in Canada’s cannabis space at the moment, however, is coming from outside the regular circles of cultivation, processing and dispensing. In a move that was anticipated, a leading alcoholic beverage company – Constellation Brands – invested CDN $245 million in Canopy Growth (OTC: TWMJF) (TSX: WEED) in exchange for nearly 10 percent equity in the company (http://nnw.fm/MD9nU). Industry titans like Constellation, which has stated it plans to develop and sell cannabis-infused drinks, were fully expected to take a hard look at the booming legal marijuana market. Buying into an already established asset such as Canopy Growth gives this major player a fast toehold into the cannabis sector. Anticipation is growing that more asset acquisitions will soon follow by other leaders in the tobacco, alcohol and pharmaceutical industries (http://nnw.fm/1pt6W).

In order to take advantage of Canada’s projected $9 billion cannabis market, companies like ABcann must keep an eye on the future while taking care of the present. The company’s announcement last month that Paul Lucas will be its new independent chairman following founder Ken Clement’sdecision to step down shows a keen eye for continuity of leadership and historical knowledge of the industry (http://nnw.fm/n3fU0). Lucas, former president and CEO of GlaxoSmithKline Canada, brings decades of pharmaceutical industry experience to his new role at ABcann Global. That kind of global experience will serve the company well as it looks to expand its footprint in the legal cannabis industry. ABcann’s vision includes becoming a global presence in the legalized marijuana markets of CanadaGermany, all of Western Europe and South America (http://nnw.fm/Z60nx).

Another key Canadian LP focused on ramping up its production is Aurora Cannabis (OTCQX: ACBFF) (TSX: ACB), a licensed medical marijuana company engaged in producing and distributing cannabis to registered patients with a physician’s prescription. Aurora operates a 55,200-square-foot production facility in Mountain View County, Alberta, a second 40,000-square-foot production facility in Pointe-Claire, Quebec on Montreal’s West Island, and is currently constructing an 800,000-square-foot production facility at the Edmonton International Airport. Earlier this week Aurora announced it plans to accelerate the expiry date of common share purchase warrants for potential proceeds of $50 million-plus (http://nnw.fm/Ohdg8), which the company says it plans to use for expansion initiatives.

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

Aphria (OTCQB: APHQF) (TSX: APH), another 100 percent greenhouse-grown medical cannabis company, prides itself on growing cannabis in natural sunlight in state-of-the-art facilities. Through a strategic investment agreement into DFMMJ Investment Ltd., a special purpose private company, the company is seeking expansion targets that meet its stringent criteria in key U.S. states that have approved medical use of marijuana (http://nnw.fm/Jb4d4).

Aphria recently announced (http://nnw.fm/alzQ3) the sale of nearly 13 million common shares for gross proceeds of $92 million, which the company says it will use in connection with the construction or acquisition of domestic production facilities.

Medical marijuana dispensary Delta 9 Cannabis, Inc. (TSX.V: NINE), headquartered in Ontario, Canada, has stated its intent to work collaboratively with Canopy Growth in the Manitoba cannabis market, including cannabis production and distribution functions as each company pursues privately owned and operated retail shops. Expanding its physical locations is key to Delta Nines future success, said Delta 9 co-founder and CEO John Arbuthnot (http://nnw.fm/sWPe6).

Since 2013, Health Canada, which issues the coveted medical marijuana commercial license, has approved fewer than 2 percent of the 1,600 companies seeking a license to grow cannabis. The rigorous process of becoming a licensed producer of marijuana in Canada imposes significant barriers to companies with plans of entering the market.

ABcann already owns and operates a fully functioning 14,500-square-foot facility in Napanee, Ontario, and owns another 65 acres of real estate with proper zoning and existing infrastructure in place to support another facility of up to 1 million square feet. The company’s global potential can clearly be seen through its partnership with Israel’s Syqe Medical, producer of one of the world’s first selective-dose pharmaceutical-grade medicinal plant inhalers. Scaling operations to achieve optimal growth isn’t a second thought – it’s been in the planning stages all along. For ABcann, it’s fair to say that the company’s five-year track record in Canada upon legalization next July is giving it a distinct head start (http://nnw.fm/8GGEu).

For more information on ABcann Global, visit: ABcann Global (TSX.V: ABCN) (OTCQB: ABCCF).

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