U.S. Attorney General William Barr.

U.S. Attorney General William Barr ordered investigations into 10 proposed marijuana business mergers – a transfer {that a} profession Justice Department prosecutor charged was “not even close to meeting established criteria” for such critiques. That prosecutor, John Elias, agreed the critiques amounted to business “harassment.”

MJBizDaily takeaway: The episode stands as a warning to the U.S. hashish business that highly effective authorities officers stay keen to let their biases intrude with the enterprise dealings of authorized marijuana corporations.

While Barr won’t have damaged any legal guidelines, it’s controversial he overstepped – as Elias informed a House panel. Cannabis corporations had been compelled to provide thousands and thousands of paperwork, and the scrutiny contributed to the scuttling of the $682 million MedMen-PharmaCann merger.

Canopy Growth amends Acreage acquisition 

Canadian marijuana producer Canopy Growth modified the phrases of its proposed acquisition of U.S. multistate operator Acreage Holdings, revising the worth downward from $3.four billion to roughly $900 million.

MJBizDaily takeaway: The writing was on the wall for such a transfer. Acreage’s current resolution to safe a $15 million mortgage at a whopping 60% rate of interest was a serious indicator of the cash-strapped firm’s monetary woes.

Whether Canopy can flip round Acreage’s falling star stays to be seen. The deal’s closure stays conditioned on the U.S. authorities legalizing marijuana.

L.A. shifts course dramatically

The Los Angeles City Council gave its tacit approval to main regulatory modifications which are poised to dramatically upend town’s authorized marijuana market by overhauling  the MJ enterprise licensing plan and the way L.A.’s social fairness program works.

MJBizDaily takeaway: It will most likely take weeks for stakeholders to completely grasp the importance of the shift in L.A.. But a central change that has some exuberant and others up in arms is that retail permits can be granted solely to social fairness candidates till 2025.

That signifies that until a enterprise is majority owned by an individual who qualifies for the social fairness program, there’s no method into the L.A. marijuana market – not less than as a retailer.

Aurora Cannabis shuts services, lays off 700

Canadian producer Aurora Cannabis will shutter 5 of its services and lay off 700 workers. The strikes are a part of a refocusing that features slicing prices and streamlining manufacturing.

MJBizDaily takeaway: Aurora is the most recent Canadian hashish enterprise to announce a dramatic course correction. All relate again to their overspending on hashish cover and a spree of mergers and acquisitions around the globe.

Over the previous 12 months, others have pivoted to shed expensive infrastructure and spontaneous investments that didn’t pan out. Make no mistake: The Canadian business is rising quickly. But the big gamers nonetheless have work to do to rightsize their ships.

Denver points first marijuana R&D license

The metropolis of Denver awarded its first marijuana analysis and improvement allow for a personal enterprise to assist in the examine of  hashish as a medical therapy.

MJBizDaily takeaway: Industry insiders have lengthy speculated that the medical potential of marijuana has barely been touched, for the reason that overwhelming majority of scientific analysis on the plant has not been for such functions – however reasonably to again the failed warfare on medicine.

With additional R&D, it’s doable hashish may yield more efficient medical therapies for an array of illnesses. Denver’s transfer may assist pave the best way for a brand new technology of medical marijuana merchandise, or not less than for more R&D packages in different cities and states.

Curaleaf revises acquisition deal

Another acquisition deal the place phrases had been modified considerably is the acquisition of Chicago-based Grassroots Cannabis by Massachusetts-based Curaleaf. The deal initially was valued at $875 million. But because of falling inventory costs, the deal is now value roughly $700 million.

MJBizDaily takeaway: The merger will nonetheless be a blockbuster for Curaleaf by increasing its U.S. footprint from 18 states to 23.

But in distinction to the Canopy-Acreage deal, the drop in worth of the GrassRoots-Curaleaf transaction was on the client’s aspect. Curaleaf is publicly traded, and the worth of its inventory has plummeted – as have the values of most publicly traded MJ corporations over the previous 12 months.

By distinction, Grassroots is privately held.

John Schroyer may be reached at [email protected]

Source link