Last week, the Green Organic Dutchman (TGOD) filed a prospectus related to an initial public offering. The Canadian marijuana producer plans to raise up to $100 million at $3.65 per unit through a brokered private placement being led by Canaccord Genuity and PI Financial.

Over the last year, TGOD has been nothing short of an execution story and the market is very much looking forward to this IPO. With over 116,000 kilograms of funded production capacity this marijuana producer is positioned to be a giant.

An Elite Opportunity

We have been favorable on TGOD since inception and our conviction level has never been stronger. The management team has executed flawlessly and has made several strategic additions to the team over the last year.

TGOD has attracted top talent from leading licensed producers like Aurora Cannabis (ACB.TO) (ACBFF), which invested more than $50 million in the company earlier this year. We are favorable on the strategic relationship with Aurora and expect this be a significant growth driver for both companies.

To date, TGOD has raised a total of $160 million, fully funding the expansion of 970,000 sq. ft. state-of-the-art, ultra-high technology hybrid greenhouse facilities in Ancaster, Ontario and Valleyfield, Quebec. TGOD’s expansion and strategic partnership with Aurora positions the company as an industry leader and sets the foundation for the highly anticipated upcoming 2018 IPO.

TGOD: The Next Big Canadian IPO

TGOD is a licensed medical cannabis producer in Canada uniquely positioned within the burgeoning medical and recreational cannabis industry. TGOD produces farm grown pharmaceutical grade organic cannabis without the use of synthetic pesticides through all-natural craft growing techniques and organic principles.

The company is focused on building a well-balanced and multi-disciplinary team that can leverage the experience, purchasing power and sector specific expertise of two multi-billion dollar companies as strategic partners. These partnerships have de-risked the project and provide shareholders with above average rates of returns based on a platform of long-term growth, stability and profitability.

TGOD has differentiated itself from the competition by offering craft style premium organic cannabis. This style of cannabis is better for the consumer as well as the company since it sells for a higher price with increased margins. The company is led by a management team that has a proven track record of success with licensed Canadian medical cannabis producers such as OrganiGram (OGI.V) (OGRMF) and Emblem Corp (EMC.V) (EMMBF).

TGOD is focused on producing a high-quality organic cannabis higher-margin product and is working to create the ideal balance of quality and quantity. The company is currently in the middle of a major expansion, with the first phase expected to complete by the fourth quarter of 2018.

Focused on a Massive Buildout in Québec

TGOD intends to build an 820,000 sq. ft. greenhouse facility (the Québec Facility) that is expected to produce 102,000 kg of cannabis annually. The initial phase is expected to be completed by the second quarter of 2019.

In October, TGOD submitted an application for an additional site license for the Québec facility and we are closely monitoring the company’s progress. The property is zoned in part for industrial purposes and in part for agricultural purposes which allows the company to build a research and development facility, a facility suitable to become a Licensed Dealer, and manufacturing facilities, all next to the cultivation facilities.

In order to expedite the licensing of the Québec Facility, a 2,700 sq. ft. breeding facility is currently under construction and is expected to be completed in the second quarter of 2018. The facility will let TGOD breed cannabis strains for large scale agricultural production and provide high-quality, reliable strains to the cannabis market. Using the 36 strains currently in its inventory and working with Health Canada to legally source additional genetic material from external sources, the company anticipates being able to use the facility to bring some of the best strains to market.

TGOD has commenced the municipal permitting process to start construction of the initial phase of the Québec Facility and anticipates that the municipal permitting process will be completed in the second quarter of 2018. As of the date of the prospectus, TGOD has identified the need for certain provincial environmental authorizations for the initial phase.

The Québec Facility will be serviced by industrial gas lines, sewage and unlimited water access, and is within 1.5 km of a Hydro-Québec power substation. In order to complete the interconnection with Hydro-Québec for the initial phase, TGOD intends to build a power substation at the Québec Facility. The company has been granted the “economic development rate” by Hydro-Québec and will therefore receive a reduction in electricity rates until March 31, 2027, which is expected to reduce operating costs at the Québec Facility.

In addition to all of the features listed for the Hamilton Facility, the Québec Facility will be a one-of-a-kind greenhouse with higher automation capabilities, including mobile tables that travel to designated workstations to streamline production flow. The Québec Facility, as with Hamilton Facility, will be LEED certified.

A Long-Term Opportunity

We expect to see TGOD show consistent growth and improving fundamentals on a year-over-year basis for many years to come as it continues to execute on its business plan and deliver value to shareholders. The marijuana producer is laser focused on operating at a high margin and we are favorable on the initiatives in place to grow cannabis at one of the industry’s lowest average cost per gram.

We expect the company to see rapid growth on account of its best-in-class organic products, its unique sales strategy, and its dedication to the production of premium quality cannabis. With 116,000 kilograms of funded production expansion projects, the company is poised to be one of the biggest marijuana producers in the world.

TGOD has been on the radar of cannabis investors for a long time and with an IPO imminent, we recommend keeping a very close eye on this company.