New York, New York (NetworkNewsWire) – Exceeding $7.2 billion in
2016, the legal cannabis market is maintaining a rapid expansion
rate, according to Forbes, thanks to a demand for both medical
marijuana and legal adult recreational sales in many U.S. states.
Growth is expected to continue at a compound annual rate of 17
percent, but it is more than a diverse and accessible customer base
fueling the fire. Companies such as SinglePoint, Inc.
(SING) (SING
Profile) have been busy with acquisitions that have expanded
its capabilities and reach. The company not only serves the legal
markets in Arizona, but also California, Nevada, and potentially
other soon-to-be-legal markets such as Texas. This pattern is
industry-wide. Terra Tech Corp. (TRTC),
MassRoots, Inc. (MSRT), ABcann Global
Corp. (ABCCF) (ABCN), and Medical Marijuana, Inc.
(MJNA) have also trended with acquisitions and expansions,
giving the industry the boost everyone has anticipated.
SinglePoint,
Inc. (SING) recently made two major acquisitions:
Convectium, a manufacturer and supplier of vaporizer filling
machines; and DIGS Hydro, a Southern California dispensary
operator. With these two acquisitions, SinglePoint in the second
quarter grew revenues by 378x compared to the first quarter of 2017
(http://nnw.fm/82o4T). As noted in a press
release discussing its current position, SinglePoint’s acquisition
strategy has a third transaction underway.
Detailing the success of the company’s acquisition-based growth
strategy, SinglePoint CEO Greg Lambrecht in a recent press release,
said, “…SinglePoint is in a better position than it has ever
been before. We are looking at additional companies and plan to
complete additional acquisitions prior to the end of the year. We
are well capitalized to continue acquisitions and we are optimistic
to complete around three more acquisitions and significantly
increase the company's revenue.”
A closer look at SinglePoint’s acquisition history underscores
Mr. Lambrecht’s favorable sentiment of the company’s position in
the cannabis market. Its 90-percent stake in DIGS Hydro, which
currently has two operational stores strategically located close to
established licensed growers, has positioned SinglePoint as a
leading provider of a wide range of growing equipment and
accessories for individual and commercial plant cultivators in
California (http://nnw.fm/oh7ZW). The strategy yields considerable
potential, as recreational cannabis is projected to be fully
legalized by June 2018. DIGS Hydro’s products include all-in-one
systems for growing plants plus grow rooms, supplies, HVAC system
setup, hydroponic garden products, and accessories. Territorial
growth into large, opportunistic markets like this promises to fuel
continued growth for the company and the industry.
In March of 2017, SinglePoint made an investment in Convectium,
the creator of a unique oil filling machine capable of filling
cartridges or disposable vape pens for wholesale distribution to
dispensaries. Convectium’s 710Shark and 710Seal system can fill and
package up 100+ cartridges or disposable vape pens in 30 seconds.
Leaning on the marketability of this first-of-its-kind system for
the cannabis industry, as well as its line of B2C products,
Convectium previously forecast full-year 2017 sales of $3.5 million
(http://nnw.fm/Uz1hR).
“We have evaluated numerous investment prospects in the cannabis
space, and found there is nothing that compares to this opportunity
we have with Convectium,” Lambrecht stated in a press release
announcing the deal (http://nnw.fm/WrO6R). “With this transaction, we will
acquire a stake in a cannabis business that never touches a
marijuana plant. This is the strategy we will use as we move
forward to hedge us against changing federal and state laws.”
In August, SinglePoint signed a Letter of Intent to acquire a
51-percent stake in Phoenix-based medical marijuana distribution
company, Dr. FeelGood. With its acquisition of Dr. FeelGood on the
horizon, SinglePoint will soon add another revenue stream to its
model, as well as the decades of expertise of owners Scott Riley
and Jeff Clevenger who will run the daily operations of Dr.
FeelGood and assist with its expansion strategy.
The initial plan calls for the development of a delivery
platform utilizing SinglePoint's location-based delivery
application. Additional features, such as a directory and ordering
system to directly compete with Leafly and WeedMaps, will then be
implemented to cement the technology's position in the market. The
collaboration supports Dr. FeelGood’s existing plans to build the
app to quickly meet existing and growing interest it the
technology.
While SinglePoint enjoys a unique, diversified position in the
cannabis industry, the company is joined by several other
innovators demonstrating the girth of the market.
Terra Tech Corp. (TRTC) saw a 57.9-percent
increase in cannabis-related sales in Q2 2017 compared to the same
period during 2016. The company’s Edible Garden subsidiary provides
locally-grown herbs and greens nationwide, serving over 40 million
medical cannabis customers a month, available at over 1,800 retail
outlets. It also recently signed an agreement (http://nnw.fm/QcAk4) to purchase 50 percent of NuLeaf
Sparks Cultivation LLC and NuLeaf Reno Production LLC, giving it
access to the cannabis cultivation and medical market in Nevada.
Two production facilities are under construction in the state from
these entities – a 30,000-square-foot facility in Sparks, Nevada,
and a 15,000-square-foot facility in Reno.
MassRoots, Inc. (MSRT) recently announced a $12
million stock deal (http://nnw.fm/uoKq3) in the acquisition of CannaRegs
Inc., a platform able to track cannabis regulation changes at the
municipal, state, and federal level. The company has reported over
$450,000 in contractually obligated annual revenue and is also
tapping into the legal cannabis market in California. It also
entered into a Definitive Agreement with Odava, a company involved
in compliance, supply chain management, and point-of-sale
technology. The agreement gives MassRoots access to the Oregon
market, while its December 2016 acquisition of DDDigtal Inc. gave
it access to a high-volume menu management and online ordering
platform, which processed more than $5 million in transactions
between May and December that year.
ABcann
Global Corp. (ABCCF) (ABCN) recently announced
expansion plans of its own. In Q3 2017, it will build a
100,000-square-foot facility in Napanee, Ontario, revised from an
original phase 1 plan of 71,000 square feet for its Kimmett
facility (cultivation is expected to begin by Q4 2018). Also, the
company revealed production capacity at the Vanluven facility will
double to serve its growing patient base, with first cultivation
anticipated for Q1 2018. The company also aims to serve the booming
Canadian cannabis market through its acquisition of ABcann
Medicinals, one of the dominant medical growers of organic,
pesticide-free product in the country. In addition, it announced
the purchase of land that would increase its production by 20-fold.
With a $43 million cash position only three months after becoming a
publicly traded company, ABcann is positioned as one of the leading
medical cannabis growers in Canada.
Medical Marijuana, Inc. (MJNA), which merged
with CannaBANK in 2011, revealed an acquisition of Kannaway in
2015, a network marketing company, to help expand its brand of
cannabidiol-based powders, proteins and supplements. Kannaway’s
sales staff in the U.S. and expansion into Europe and South America
didn’t hurt with territorial expansion either. It also has
subsidiaries in Brazil and Mexico, and an investment in AXIM
Biotechnologies, a cannabinoid research and development firm. In
July 2017, Kannaway, now an MJNA subsidiary, announced its largest
single-day revenue in company history, and also recently announced
a 135-percent revenue increase in Q1 2017 over the same quarter a
year earlier.
The cannabis industry is growing by leaps and bounds to support
demand, helped by acquisition and territorial expansion activity of
leading companies. Ease of purchase is aiding sales too;
case-in-point, www.SingleSeed.com, launched by SinglePoint to provide
a wide variety of business solutions for dispensaries, retailers
and other cannabis companies. The bold strategies of SinglePoint
and other companies appear to be paying off as the broader
marijuana market continues to grow at an accelerated pace.
For more information on SinglePoint please visit: Singlepoint
(SING) or www.SinglePoint.com
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