Maple Leaf Doubles Down on ACMPR License
Ryan Allway
March 21st, 2017
News, Top News
Canada’s cannabis industry is expected to reach upwards of $20 billion in annual revenue over the coming years as recreational legalization is rolled out nationwide. Investors looking to capitalize on these dynamics have a limited number of opportunities with less than 40 producers licensed by Health Canada. Since most of these companies already trade with C$100+ million market capitalizations, investors may want to consider those close to obtaining a license.
In this article, we will take a look at Maple Leaf Green World Inc.’s (TSX-V: MGW) (OTCQB: MGWFF) plans to obtain licensed producer status over the near-term.
Significant Potential
Canada’s cannabis industry could reach upwards of $22.6 billion in annual revenue after recreational legalization, according to Deloitte. The analyst believes that more than 600,000 kilograms of marijuana will need to be grown each year, which is significantly more than the existing 39 licensed producers grow for medicinal purposes. The arduous process of becoming a licensed producer could maintain these favorable dynamics for years.
Maple Leaf is in the last stage of approval (“Stage 5”) to become a licensed producer under the Access to Cannabis for Medical Purposes Regulations (“ACMPR”). With many licensed producers trading with $100+ million market capitalizations, a license could be a significant opportunity for the company given its modest C$77 million existing market cap (as of March 16, 2017) – even without considering its other business ventures in the United States.
| Name | Ticker | Market Cap |
| Canopy Growth Corp. | TSX: WEED | C$1.73 B |
| Aphria Inc. | TSX-V: APH | C$794.8 M |
| Aurora Cannabis Inc. | TSX-V: ACB | C$752.2 M |
| Organigram Holdings Inc. | TSX-V: OGI | C$235.6 M |
* Data as of March 16, 2017 via MarijuanaIndex.com
In March, the company announced that it intends to raise up to C$6 million in a non-brokered private placement to accredited investors. The proposed private placement consists of an offering of up to 11 million units at a subscription price of $0.55 per unit, each unit being comprised of one common share and one common share purchase warrant. Each warrant be exercisable at a price of $0.85 for a period of two years after closing.
Building a New Facility
Maple Leaf has been working with TheraCann, a leading full service international marijuana consultancy, to prepare for the final stage of approval from Health Canada. After completing a site visit, the team made the decision to construct a new facility on 33 acres of vacant land rather than attempting to renovate the existing facility. This will enable the company to use the latest technologies to increase production per square foot and reduce production costs.
In other to maintain its position in the inspection queue, the company plans to begin development of the facility as soon as possible with the goal of obtaining a production license during the fourth quarter of this year. The effort marks a doubling down on its Canadian license as the best path towards creating shareholder value given the federal government’s friendly approach to the industry compared to the United States’ uncertainty.
Looking Ahead
Maple Leaf Green World Inc. (TSX-V: MGW) (OTCQB: MGWFF) has doubled down on its plans to secure licensed producer status in Canada’s burgeoning cannabis industry. With funding in place, the company is constructing a new facility on 33 acres and anticipates securing a production license during the fourth quarter of this year. A successful license could be a turning point for the company with its modest market capitalization relative to approved licensees.
For more information, visit the company’s website or CannabisFN’s company profile.
This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.
About Ryan Allway
Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.
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