Most cannabis takeover deals done using stock

When it comes to M&A deals in the cannabis sector, the currency of choice appears to be stock. BNN Bloomberg’s David George-Cosh reports that nearly 70 per cent of all marijuana takeover deals made this year have been conducted with just stock, according to figures obtained by Dealogic. That compares to about 17 per cent of all global M&A deals. When it comes to cash, it accounts for only 1 per cent of cannabis M&A compared to 54 per cent of global activity. Why? Cannabis companies have difficulty raising debt, making it hard to obtain capital, and CEOs are also taking advantage of skyrocketing valuations.

Asia could be the next frontier for cannabis

Smoking pot in some Asian countries could land you in prison, but investing in their respective cannabis industries might be a windfall. Bloomberg’s Fox Hu reports about the Hong Kong Cannabis Investor Symposium, which drew a bevy of investors and cannabis executives to discuss opportunities in expanding the marijuana business in Asia. China appears to be a frontier market for cannabis with some entrepreneurs already making forays into the Middle Kingdom. Medical cannabis is cultivated in the country under government control.

NDP wants legal edibles - now

The NDP doesn’t want Canadians to wait another year to buy cannabis-infused edibles. NDP Leader Jagmeet Singh told BNN Bloomberg’s David George-Cosh that if cannabis is legalized in Canada, everything should be available for Canadians – including pot-infused candies, drinks and other goods. Singh’s comments mirror some of his Ottawa colleagues who stated that this extra year of edible prohibition wasn’t needed because Canadians are still likely to purchase those goods but through unregulated channels.

Shady characters still linked to pot industry

The Canadian government’s move to legalize cannabis was aimed at cutting out pot’s connection to the underworld, but some links still remain. An investigation by Radio-Canada found ties between an investor in a major Canadian cannabis company and influential Mafia members and drug traffickers. Radio-Canada, which is not naming the companies or individuals involved in its investigation, brought to light a link between a company that operates in the cannabis sector and a prominent member of the Rizzutos, the powerful Montreal crime family.

Canopy closes Constellation investment

The biggest investment in the cannabis industry (to date) is official. Canopy Growth announced late Thursday that Constellation Brands’ $5 billion investment in the company has officially closed after it was approved by an overwhelming majority of Canopy’s shareholders and received the all-clear from Canadian and provincial regulators. This investment now positions Canopy with a sizable war chest when looking to build scale in the more than 30 countries currently pursuing medical cannabis programs. With the investment, Constellation Brands now owns 37 per cent of Canopy along with two board seats.

DAILY BUZZ

US$194 billion

- the forecasted value of the global cannabis industry in 2025, according to a Bank of Montreal report. The report assumes that value will be reached if the U.S. and all 28 EU countries legalize marijuana for both recreational and medical use

Cannabis Canada is BNN Bloomberg’s in-depth series exploring the stunning formation of the entirely new – and controversial – Canadian recreational marijuana industry. Read more from the special series here and subscribe to our Cannabis Canada newsletter to have the latest marijuana news delivered directly to your inbox every day.