Wall Street Veteran Sells Cannabis Operations Stake in $25mm Deal
In yet another example of publicly-traded Canadian companies entering the U.S. cannabis industry, Canadian Bioceuticals (CSE: BCC) (OTC: CBICF), through its CGX Life Sciences subsidiary, announced today the acquisition of a group of companies in Arizona and the option to acquire a licensed cultivation facility in North Las Vegas, Nevada for $25mm.Source: New Cannabis Ventures
The company, which recently completed a private placement of C$35.5mm, paid $25mm, including $15mm cash and a $10mm promissory note to acquire assets and a long-term management agreement related to two not-for-profit licensees in the Mesa area in Arizona and two brands
Health for Life, the name of the dispensaries, and Melting Point Extracts.
BCC reported that the Arizona operations have about 5.2% market share in the state with $8.5mm in sales in the year ending March 31, 2016 and a projected $19.2mm in sales for the year ending March 31, 2017.
BCC also acquired the option to buy a controlling position in GreenMart for $9mm by July 1, 2018.
Beth Stavola, who will run CGX Life Sciences, is the CEO of Stavola Medical Marijuana Holdings, the seller of the brands to BCC. Before entering the cannabis industry as an investor six years ago, Stavola was an institutional equity salesperson at Jefferies & Company for 10 years. She also operates CBD for Life.
About Alan Brochstein, CFA
Based in Houston, Alan leverages his experience as founder of online communities 420 Investor, the first and still largest due diligence platform focused on the publicly-traded stocks in the cannabis industry.
With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth.
At New Cannabis Ventures, he is responsible for content development and strategic alliances.
Before shifting his focus to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst following over two decades in research and portfolio management.
A prolific writer, with over 650 articles published since 2007 at Seeking Alpha, where he has 70,000 followers, Alan is a frequent speaker at industry conferences and a frequent source to the media, including the NY Times, the Wall Street Journal, Fox Business, and Bloomberg TV.bout
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