As summer comes to an end and harvest season begins, the cannabis sector has gone into rally mode. In particular, the three Canadian cannabis giants – Aurora, Aphria, and Cronos – have continued to boldly expand, partner up, and seize opportunities around the world. Here are the highlights of these stories this week….
Earlier this year, Canadian licensed cannabis producer Aurora Cannabis (ACB.TO) (ACBFF) announced a major investment in The Green Organic Dutchman (TGOD.TO) (TGODF), a cannabis industry company that produces farm grown, high quality organic medical cannabis in small batches using organic craft growing principles. Last week, TGOD expanded Aurora’s option to acquire an additional 8% of the business by 30 days after Aurora closed a $200 million debt financing with BMO.
The market responded very favorably, both towards the initial announcement and at the announcement of the extension, and for good reason. The two companies have enormous potential for profitable synergy, driving each other to previously unreached heights of success in 2019 and beyond.
Executives from Aurora Cannabis and TGOD will be attending next week’s cannabis investing conference, The MoneyShow Toronto (14 to 15th September 2018), giving prospective investors the perfect opportunity to meet these leading Canadian cannabis producers and learn more about their plans to capitalize on opportunities in the global space.
It’s been a monumental year for Aphria (APH.TO) (APHQF), a global leader in high quality, safe, and pure pharmaceutical-grade cannabis. The Canadian cannabis giant has dedicated a lot of its resources to acquiring strategic, global assets and international companies such as Broken Coast Cannabis and Nuuvera, as well as others in Latin America.
They also just announced their partnership with Schroll Medical, a subsidiary of Schroll Flowers, which is a prominent European flower producer. The intention of this partnership, which will be managed by the company’s wholly owned subsidiary Aphria Deutschland GmbH, is to “pursue the cultivation and worldwide distribution of organic, EU GMP-certified medical cannabis.”
“Aphria continues to execute on its strategy for international expansion, and we are pleased to have joined forces with a highly-regarded, experienced grower known around the world for its quality,” said Aphria’s Chief Executive Officer, Vic Neufeld. “Our co-founders come from the world of commercial agriculture, including commercial flower production, so we speak the same language as Schroll and we bring to this Partnership the best-in-class know-how to produce high-quality, clean and pure medical cannabis for the worldwide market. Partnerships such as this continue to build upon Aphria’s foundation for long-term sustained growth in every market in which we operate.”
The deal accelerates the Canadian cannabis giant’s global expansion and the first product is expected to be available by early 2019.
Last week, the Cronos Group (CRON.TO) (CRON), a geographically diversified and vertically integrated Canadian cannabis group, hit a little turbulence as Citron’s infamous Andrew Left announced that he would be shorting them. Shares in the company took a hit but have recovered somewhat this week. This recovery was aided by Cronos’ announcement that it would be partnering with biotech company Ginkgo Bioworks to produce cultured cannabinoids.
Ginkgo will work with Cronos on research and development of microorganisms capable of producing certain target cannabinoids in a scalable and highly efficient manner.
“Cronos Group is building the world’s most innovative cannabinoid platform,” said Mike Gorenstein, CEO of Cronos Group. “The potential uses of cannabinoids are vast, but the key to successfully bringing cannabinoid-based products to market is in creating reliable, consistent, and scalable production of a full spectrum of cannabinoids, not just THC and CBD. We are thrilled to partner with Ginkgo; their biological engineering capabilities and disruptive technology platform are unrivaled. Together we can revolutionize the cannabis industry.”
“Legal cannabis is a multibillion-dollar industry with no signs of slowing down, but providers will need to innovate to keep up with demand for better products, including those taking advantage of rare and difficult to extract cannabinoids,” said Jason Kelly, CEO and co-founder of Ginkgo Bioworks. “Engineering strains of yeast that can produce these cannabinoids via fermentation is a perfect fit for our organism design platform and we are excited to be working with Cronos Group as they lead the way to high-quality cannabinoid treatments.”