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) (OTCQB: 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) (OTCQX:
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) (OTCQB:
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™ 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™, the brand has created a
sense of history while remaining fresh and youthful in its
style.
The Choom™ 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™ 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. (TSX.V: ABCN) (OTCQB: ABCCF) recently invested $4 million
in Choom™, 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™.
“ABcann remains committed to becoming a global leader. With our
strategic investment in Choom™, 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™ 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™: 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™ 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 (TXS: 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 (TSX.V:
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 (TSX.V: 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™, 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™, put both sides in a strong position
to seize that moment.
For more information on Choom™, 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
NetworkNewsWire (NNW)
New York, New York
www.NetworkNewsWire.com
212.418.1217 Office
Editor@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. The
commentary, views and opinions expressed in this release by NNW are
solely those of NNW. Readers of this Article and content agree that
they cannot and will not seek to hold liable NNW for any investment
decisions by their readers or subscribers. NNW is 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, 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 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 undertakes no
obligation to update such statements.
Source:
NetworkNewsWire
Contact:
NetworkNewsWire (NNW)
New York, New York
www.NetworkNewsWire.com
212.418.1217 Office
Editor@NetworkNewsWire.com
Choom (CSE:CHOO)
Historical Stock Chart
From Nov 2024 to Dec 2024
Choom (CSE:CHOO)
Historical Stock Chart
From Dec 2023 to Dec 2024
