Canadian cannabis producer Aurora Cannabis has sealed the deal to buy out the smaller producer CanniMed Therapeutics after what was reportedly a heated acquisition. Dramatic or not, it was a timely move, as Canada is planning to broadly legalize cannabis by July of this year.
Canada will be the second country (after Uruguay) to have gone the fully legal route nationwide, opening the doors to an enormous pot economy. The Aurora/CanniMed acquisition alone is valued in the billions and mergers and takeovers are happening at a rapid clip right now in Canada.
In October, Constellation Brands, Inc. of the Corona beer fame bought out Canopy Growth Corporation, and it is predicted that more alcohol companies will be coming on board before July.
The Aurora and CanniMed deal is the biggest to go down so far, though, and COO of Aurora, Cam Battley, said to Bloomberg, “It has been quite a long road, but it’s been well worth it. We’re going to create something new and very special in this sector.”
Canada has just said no to prohibition and the economy is already soaring ahead of the July deadline to go balls to the walls legal. Canada’s Prime Minister Justin Trudeau promised in 2017 that by July 2018 there would be a wholly legal market, and he’s following through with flying colors.
Canada’s Parliamentary Budget Office predicts that 655 metric tons of marijuana will be imbibed this year alone. They’re also predicting that 4.6 million persons will pick up the pipe at some point this year, granted that they’re 15 years or older.
Business consultancy EY put out a recent report finding 87 percent of executives of licensed cannabis producers are expecting more mergers and acquisitions after the legalized market solidifies then expands.
In the US, some similar deals are going down in the nine states that have legalized recreational cannabis, but unfortunately, as long as marijuana remains a Schedule I drug in the states, larger companies are going to be wary of big acquisitions that could potentially be cracked down on by the office of Attorney General Jeff Sessions.