Staff
The Daily Hit is a recap of cannabis business news for Sept. 12, 2022.
ON THE SITE
Bummer Summer
Cantor Fitzgerald cannabis analyst Pablo Zuanic published a report on the negative trends impacting the industry. Price compression along with increased competition has made the retail environment a challenging one. Sales in July and August are down in most states and the market dynamics seem to be changing as companies pivot to adjust. The analyst wrote about “worsening growth trends in most of what we call the ‘MSO states’ (IL/PA/FL/AZ/CA/OH/MD) with the exceptions being MA/MI/NV; but in these last three states, prices are down, and we believe retailer economics have worsened.” Zuanic also called noted that wholesalers are finding that their customers are beginning to produce their own brands and specifically called out Colorado where 70% of the flower market share is ‘private label’. Read more here.
FaZe Rain
TPCO Holding Corp. (OTCQX: GRAMF) has tapped one of the most well-known Youtube cohorts on the platform to induct it into its budding brand house. Nordan Shat (aka FaZe Rain), Youtube star and co-founder of the popular esports and entertainment organization, FaZe Clan — along with Quinn “The Wizard”, Yonatan Hagos and Erick Kahn — has partnered with TPCO to launch RCVRY, a premium cannabis brand co-founded by the group and The Parent Company’s Caliva premium cannabis brand. Read more here.
BellRock
BellRock Brands Inc. (CSE: BRCK.U) announced that one of its U.S. subsidiaries is going to purchase Jackson, Michigan-based JRMI27, LLC, a medical and adult use marijuana product manufacturer. BellRock’s flagship brands, Dixie Brands and Mary’s Medicinals already have products in Michigan under a licensing agreement with JRMI27, but the acquisition of the license by the subsidiary of the company, if approved, will offer BellRock a lasting presence in the Michigan market. The company did not disclose the price paid for the company. BellRock has also not published financial information on the company since October 2021. Read more here.
Jim McMahon
Jim McMahon, a longtime medicinal marijuana advocate, is looking to break into the Illinois cannabis market. The legendary former Chicago Bears quarterback is a co-founder of marijuana brand Revenant, which launched in California last summer and expanded into Arizona last week. “We’re looking forward to coming to Illinois,” McMahon, who is in Chicago for a wedding, said in an interview. “We’re in negotiations with different people,” though he declined to name any potential partners. “We want to be nationwide as soon as we can.” Read more here.
Illinois
Illinois’ legalization of recreational marijuana was designed in part to generate revenue by taxing the marijuana trade and in part to balance the scales of justice for minority communities that had been hit hard by heavy-handed pot prosecutions dating back to the “war on drugs” era. There are troubling signs that Illinois’ legalization program, which went into effect in January 2020, is falling short on both fronts. Read more here.
IN OTHER NEWS
PharmaCann Inc., one of the nation’s largest privately held, vertically integrated cannabis companies, today announced the planned acquisition of all four locations of The Clinic, a group of premiere, boutique Colorado marijuana dispensaries. The planned acquisition contemplates rebranding all locations to the popular LivWell brand. Upon completion of the acquisition, LivWell, the state’s leading cannabis brand, will enjoy the largest presence in Colorado with 26 dispensaries in the Centennial State. The Clinic’s dispensary locations are within the Denver metro area and offer award-winning cannabis products and accessories to both recreational customers and medical patients. “PharmaCann’s acquisition of The Clinic’s dispensaries expands our presence in Colorado, bolstering the LivWell brand’s prominence as a locally renowned cannabis brand in the state with strong ties to local communities,” said Brett Novey, CEO of PharmaCann. “We look forward to continuing to bring our world-class cannabis products to the patients and customers of Colorado’s largest dispensary footprint.” Upon completion of the planned acquisition, PharmaCann’s operations will include 26 LivWell dispensaries in Colorado. PharmaCann currently operates 55 dispensaries and nine cultivation and production facilities across eight states.
YourWay Cannabis Brands Inc. (CSE: YOUR) (OTC: YOURF) announced that Jacob Cohen has resigned as Chief Executive Officer of YourWay effective immediately. Mr. Cohen will continue to serve as President of Arizona Operations and as a director on the Company’s board of directors. The company’s Executive Chairman, Jakob Ripshtein, will assume the position of Acting Chief Executive Officer, effective immediately. Read more here.
Icanic Brands Company Inc. (CSE: ICAN) (OTCQB: ICNAF) has completed its previously announced recapitalization transaction dated June 8, 2022 between the company, and certain holders of the 9% secured convertible debentures issued pursuant to a convertible debenture indenture dated June 6, 2019, between LEEF Holdings, Inc. and Odyssey Trust Company as trustee and collateral agent, as amended by the first supplemental indenture between the Company, LEEF, and Odyssey. The Recapitalization Transaction closed which was approved by certain holders of the 2019 Debentures of the Company at a special meeting of Secured Debentureholders on August 8, 2022, and which received final approval from the Supreme Court of British Columbia on August 15, 2022. Read more here.
urban-gro, Inc. (Nasdaq: UGRO) announced that its Board of Directors has approved a new stock repurchase program authorizing the repurchase of up to $2 million of its common stock. The new repurchase program succeeds its prior $8.5 million stock repurchase program which has since been completed. Read more here.
