Le Lézard
Classified in: Health, Business
Subjects: INO, MAT

Big and Small Companies Partner up to Provide Canada's Cannabis


NEW YORK, March 21, 2018 /PRNewswire/ --

NetworkNewsWire Editorial Coverage 

With recreational cannabis only months away from legalization in Canada, companies are racing to prepare for the new market. For many, this means partnerships, supply agreements, and external investment. Choom Holdings, Inc. (CSE: CHOO) (OTC: CHOOF) (CHOOF Profile) has received a substantial investment from ABcann Global to develop its high-end retail brand and growing facilities. Aurora Cannabis, Inc. (TSX: ACB) (OTC: ACBFF) has entered into a supply agreement with Shoppers Drug Mart and invested in Liquor Stores N.A. Ltd. to support expansion in both the medical and recreational sectors, and OrganiGram Holdings, Inc. (TSX-V: OGI) (OTC: OGRMF) inked a deal with TGS Colorado, providing access to technology and designs not available to other Canadian companies. The Hydropothecary Corporation (TSX-V: THCX) struck a deal with the Société des alcools du Québec, while The Supreme Cannabis Company, Inc. (TSX-V: FIRE) (OTC: SPRWF) has invested $3 million in BlissCo, a new producer. Across the industry, such deals are paving the way for growth.

Canadian Cannabis Producers Pivot toward Small Consumer Brands 

With the legalization of recreational cannabis on the horizon, Canadian growers are preparing for an expanded market. Once limited to growing and selling cannabis for medical purposes, licensed producers now face the challenge of reaching out to a larger market. Appealing to patients and to recreational consumers involves very different approaches, and these companies are exploring various means to reach this new market.

The approach many are taking is to invest in or sign supply agreements with consumer brands. Smaller brands with strong, targeted strategies have the skills and the opportunity to appeal to recreational consumers in a way that the larger medical brands don't. Typically, these companies have never been able to rely on mass advertising and thus are oriented to reaching consumers in other ways. Because the new legislation will not allow companies to advertise cannabis where children might see it, big-budget advertising is ruled out from the start. Consequently, the skills of these smaller companies will be vital.

Focused Brands for Focused Marketing 

One of the brands providing these skills to larger companies is Choom Holdings (CSE: CHOO) (OTCQB: CHOOF) Though based in Canada, Choom[TM] has built a brand around the surf culture of Hawaii. The island's association with sun, surf and relaxation makes it a perfect symbol for a recreational cannabis brand. By drawing on the story of a fun-loving group of young people living on the island in the 1970s that coined the slang Choom[TM], the brand has created a sense of history while remaining fresh and youthful in its style.

The Choom[TM] brand savvy extends to the design for its retail stores. With its clean white lines, wood paneling and cozy sofas, the store design combines features of an Apple store with those of a surf shack, creating an atmosphere that evokes hip modern brands as well as a chill Hawaiian atmosphere. It's an approach that should make the stores appealing to both existing cannabis users as well as those who are curious to give the product a try once it becomes legal.

The company is more than just a branding front. Choom[TM] has two existing growing facilities, both of which are being prepared for legalization, have enough space to grow potentially $11 million worth of cannabis a year. The company has plans to expand these sites, increasing the flow of product into its integrated supply chain.

Investment Opportunity 

Unsurprisingly, this company has drawn attention from existing cannabis growers looking to expand into the recreational sector. ABcann Global Inc. (ABCN - ABCCF) recently invested $4 million in Choom[TM], as well as entered into a supply agreement with the company (http://nnw.fm/wMM1w).

Over the past five years, ABcann has become an established player in the Canadian medical cannabis market. Relying on its ABcann Advantage technique and its 14,500-square-foot growing facility, the company has produced premium quality organic cannabis for medical customers. It has also established a healthy cash balance with which to expand into the recreational market. One of the first steps in that process is the investment in Choom[TM].

"ABcann remains committed to becoming a global leader. With our strategic investment in Choom[TM], we are signaling a strong move into the recreational market with one of the premium recreation brands in Canada," stated Barry Fishman, CEO of ABcann Global. "With our strong cash position of approximately $135m, ABcann will pursue investments like Choom[TM] and other accretive opportunities to strengthen the company's fully integrated approach. We look forward to working with and assisting the Choom team with the supply of our premium grown products."

Big Support for a Small Company 

The involvement of ABcann brings two significant advantages for Choom[TM]: cash for growth and an established cannabis supply to get its retail business started.

One of the biggest challenges for recreational cannabis companies will be building customer loyalty, and the agreement with ABcann allows Choom to hit the ground running. The company won't need to have a large supply of cannabis grown specifically for the recreational market because it can draw on the supplies ABcann is growing under its medical license. Choom will be able to provide customers with what they want from day one, allowing the company to establish a strong foothold in the market. From there, Choom can build its profile and customer loyalty.

"This supply agreement demonstrates our commitment to becoming one of Canada's leading retailers in the cannabis space," states Chris Bogart, president and CEO of Choom. "ABcann allows us to rapidly expand our SKU base in the rollout of our retail store strategy. As we expand our efforts on strengthening our retail platform and brand position, a partnership with one of the market leaders in quality and production will be of great value to our organization. The investment and supply agreement with ABcann is a strong endorsement of our strategy and a pivotal step in developing Choom as the premium brand in Canada's recreational market."

While the supply agreement will help Choom become a frontrunner in the first months of Canada's recreational cannabis market, the investment from ABcann will make the long-term difference. With that funding, Choom can establish retail outlets across Canada, ensuring its place as one of the first nationally recognized recreational cannabis brands. The company will also have the resources to begin planned expansion of its production facilities. This expansion phase could raise Choom[TM] cannabis production from just over $11 million worth of cannabis per year to $24 million worth, doubling in-house supply by early 2019.

New Deals across the Cannabis Market 

Similar deals are being established across the Canadian cannabis industry.

Aurora (TSX: ACB) (OTCQX: ACBFF) has entered into several significant agreements. It will be supplying cannabis to Shoppers Drug Mart, Canada's largest pharmacy retailer, which will put Aurora's product in front of more medical customers. It has also invested in Liquor Stores N.A. Ltd. Liquor Stores will use this funding to launch a brand of cannabis retail outlets, converting some of its existing stores to the new brand. This will provide a well-supported outlet for Aurora to enter the recreational market, even as it bolsters its medical business.

OrganiGram (TSX-V: OGI) (OTCQB: OGRMF), a company specializing in high-quality cannabis production, has established an agreement with TGS Colorado, a seed-to-sale conglomerate with some of the best technological expertise in extract technology. This will give Organigram exclusive Canadian access to a range of best-in-class technologies, products and designs. Combined with the company's recent license to expand its growing capacity, partnership will give Organigram solid leverage in the new market.

For some companies, this preparation is about internal expansion as well as outside deals. Hydropothecary (TSXV: THCX) recently announced the addition of three experienced specialists to its management team; these leaders will cover finance, sales and general counsel. Coming hot on the heels of a deal with the Société des alcools du Québec, this move gives Hydropotherapy the leadership it needs to make the most of its agreements and expand into the recreational sector.

Supreme Cannabis (TSXV: FIRE) (OTC: SPRWF) is focused on developing its 7ACRES subsidiary into a leading cultivator of premium cannabis flower, with an eye to both the medical and the recreational market. It has also invested $3 million in BlissCo, a company close to completing its application for a cannabis growing license. As with Choom[TM], this will position Supreme Cannabis to provide a substantial supply when the recreational market becomes legal.

Recreational legalization will create great opportunities for Canadian cannabis companies. Investments by large companies in smaller ones, such as Choom[TM], put both sides in a strong position to seize that moment.

For more information on Choom[TM], please visit Choom Holdings (CSE: CHOO) (OTCQB: CHOOF).

About NetworkNewsWire

NetworkNewsWire (NNW) is a financial news and content distribution company that provides (1) access to a network of wire services via NetworkWire to reach all target markets, industries and demographics in the most effective manner possible, (2) article and editorial syndication to 5,000+ news outlets (3), enhanced press release services to ensure maximum impact, (4) social media distribution via the Investor Brand Network (IBN) to nearly 2 million followers, (5) a full array of corporate communications solutions, and (6) a total news coverage solution with NNW Prime. As a multifaceted organization with an extensive team of contributing journalists and writers, NNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. By cutting through the overload of information in today's market, NNW brings its clients unparalleled visibility, recognition and brand awareness. NNW is where news, content and information converge. For more information, please visit https://www.NetworkNewsWire.com
Please see full terms of use and disclaimers on the NetworkNewsWire website applicable to all content provided by NNW, wherever published or re-published: http://NNW.fm/Disclaimer

DISCLAIMER: NetworkNewsWire (NNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. FN Media Group (FNM) is a third-party publisher and news dissemination service provider, which disseminates electronic information through multiple online media channels. FNM is NOT affiliated with NNW or any company mentioned herein. The commentary, views and opinions expressed in this release by NNW are solely those of NNW and are not shared by and do not reflect in any manner the views or opinions of FNM. Readers of this Article and content agree that they cannot and will not seek to hold liable NNW and FNM for any investment decisions by their readers or subscribers. NNW and FNM and their respective affiliated companies are a news dissemination and financial marketing solutions provider and are NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, NNW, FNM, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer's filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer's securities, including, but not limited to, the complete loss of your investment.

NNW & FNM HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. "Forward-looking statements" describe future expectations, plans, results, or strategies and are generally preceded by words such as "may", "future", "plan" or "planned", "will" or "should", "expected," "anticipates", "draft", "eventually" or "projected". You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company's annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and NNW and FNM undertake no obligation to update such statements.

NetworkNewsWire (NNW) is affiliated with the Investor Brand Network (IBN).
About IBN
Over the past 10+ years we have consistently introduced new network brands, each specifically designed to fulfil the unique needs of our growing client base and services. Today, we continue to expand our branded network of highly influential properties, leveraging the knowledge and energy of specialized teams of experts to serve our increasingly diversified list of clients.
Please feel free to visit the Investor Brand Network (IBN) http://www.InvestorBrandNetwork.com

Corporate Communications Contact:
NetworkNewsWire (NNW)
New York
+1-212-418-1217 Office
[email protected]

Media Contact:
FN Media Group, LLC
[email protected]
+1-(954)345-0611


SOURCE NetworkNewsWire


These press releases may also interest you

at 00:25
Shanghai Junshi Biosciences Co., Ltd ("Junshi Biosciences," HKEX: 1877; SSE: 688180), a leading innovation-driven biopharmaceutical company dedicated to the discovery, development, and commercialization of novel therapies, announced its financial...

28 mar 2024
The report titled "Central Lab Market by Service Type (Anatomic Pathology/Histology, Biomarker Services, Genetic Services), Phase (Phase 1, Phase 2, Phase 3), Therapeutic Area, End-use - Global Forecast 2024-2030" is now available on...

28 mar 2024
The report titled "Personalized Nutrition Market by Measurement Type (Active Measurement, Standard Measurement), Application (Indication-based, Standard Supplements), Distribution Channel, End-Use - Global Forecast 2024-2030" is now available on...

28 mar 2024
The report titled "Carbon Dioxide Incubator Market by Product (Air Jacketed CO2 Incubators, Direct Heat CO2 Incubators, Water Jacketed CO2 Incubators), Capacity (100-200 Litre, Above 200 Litre, Below 100 Litre), Application, End User - Global...

28 mar 2024
The "Global Clinical In Vitro Diagnostic Medical Laboratory Services Market: Strategy & Trends with Volume & Price Forecasts by Chemistry, Hematology, Microbiology, Pathology, Covid-19, and Molecular Dx by Country. Updated with Impact of COVID-19"...

28 mar 2024
The "Molecular Diagnostics at the Point of Care. By Application, Technology, Place, Product and by Country. With Executive Guides and Customization 2023 - 2027 " report has been added to  ResearchAndMarkets.com's offering. Infectious disease Dx is...



News published on and distributed by: