Aleafia-Emblem Merger Creates Canada’s Largest Network of Clinics


Ryan Allway

December 24th, 2018

Exclusive, News, Top Story


Canada’s cannabis industry may be rapidly growing with new initial public offerings each week, but there has also been a fair share of consolidation within the industry. Investors may want to take a closer look at industry mergers, since they have the potential to create new industry leaders overnight. These larger combined companies may be better able to compete against industry leaders and ultimately become the next cannabis blue chips.

Aleafia Health Inc. (TSX-V: ALEF) (OTCQX: ALEAF) (FRA: ARAH) and Emblem Corp. (TSX-V: EMC) (OTCQX: EMMBF) entered into a definitive merger agreement that will create Canada’s largest cannabis clinic network along with 138,000 kilograms per year of planned annual cultivation capacity.

In this article, we will take a closer look at why investors should pay close attention to the merger over the coming months.

Click Here to receive Aleafia Health’s Investor Presentation.

Largest Cannabis Clinic Network

The combination of Aleafia Health’s Canabo Medical Clinic and Emblem’s GrowWise Health clinics will create the largest network of cannabis clinics in the country, with 40 locations nationwide serving almost 60,000 patients. While most licensed producers are focused on mail order or retail sales, medical cannabis clinics provide an opportunity to cultivate repeat customers with a hands-on approach to treatment.

Without a sales license, Aleafia’s 20+ clinics and 50,000+ patients were forced to purchase cannabis through external licensed producers. The merger with Emblem enables the company to sell high-margin cannabis flower and extract products directly to this patient population. These products include capsules, oils, and oral sprays with industry-leading revenue per gram rates and award-winning customer service and deliver options.

The company will benefit from immediate revenue generation following the closing of the transaction from these unique synergies. With the average patient being authorized for about two grams per day, the company could generate significant recurring revenue if even a modest portion of its 60,000 patients transition to purchasing its internal products following the acquisition of Emblem’s sales licenses.

Sizable Licensed Producer

Aleafia Health will become one of the largest licensed producers in the country with a fully funded 138,000 kilogram annual production capacity across three Ontario-based production facilities coming online next year. Despite production issues at other licensed producers, the company’s production facilities have delivered 100% of their provincial supply agreements—a testament to management’s ability to execute.

Emblem has existing supply agreements with Ontario, Saskatchewan, British Columbia, and Alberta, as well as medical and retail distribution through various outlets, including Shoppers Drug Mart. In addition to these agreements, Emblem’s joint venture with Acnos Pharma could provide access to more than 82 million people through 20,000 pharmacy locations while Aleafia’s CannaPacific transaction could open access to the Australian market.

The company also owns a 30,000 sq. ft. state-of-the-art extraction facility with 5,000 sq. ft. dedicated to formulation and analytical services. With GMP certification expected next year, the company could begin to export these higher-margin products over the near-term. The company also has licensing agreements in place for metered dose sprays, as well as exclusive Canadian rights to oral sustained release tablets.

Looking Ahead

Aleafia Health Inc. (TSX-V: ALEF) (OTCQX: ALEAF) (FRA: ARAH) will become one of the largest and most diverse cannabis companies in the industry following its merger with Emblem Corp. With a leading network of medical cannabis clinics and 138,000 kilograms per year of production capacity, investors may want to keep a close eye on the stock as it executes its strategy to become a leader in the medical side of the industry with a growing presence in the recreational market.

Click Here to receive Aleafia Health’s Investor Presentation.

For more information, visit the company’s website at www.aleafiainc.com.

Disclaimer

The above article is sponsored content. Emerging Growth LLC, which owns CannabisFN.com and CFN Media, has been hired to create awareness. Please follow the link below to view our full disclosure outlining our compensation: https://www.cannabisfn.com/legal-disclaimer/

Ryan Allway

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.


Network Partners

Follow Us on Social Media

About CFN Media

CFN Media (CannabisFN) is the leading creative agency and media network dedicated to legal cannabis. We help marijuana businesses attract investors, customers (B2B, B2C), capital, and media visibility. Private and public marijuana companies and brands in the US and Canada rely on CFN Media to grow and succeed.

CFN launched in June of 2013 to initially serve the growing universe of publicly traded marijuana companies across North America. Today, CFN Media is also the digital media choice for the emerging brands in the space.

Learn How Your Company can Be Covered on CFN Media

Learn More About the CFN Media Sponsored Content Program

Disclaimer: Matters discussed on this website contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, is not registered with any financial or securities regulatory authority and does not provide nor claims to provide investment advice or recommendations to readers of this release. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, may from time-to-time have a position in the securities mentioned herein and will increase or decrease such positions without notice. The Information contains forward-looking statements, i.e. statements or discussions that constitute predictions, expectations, beliefs, plans, estimates, or projections as indicated by such words as "expects", "will", "anticipates", and "estimates"; therefore, you should proceed with extreme caution in relying upon such statements and conduct a full investigation of the Information and the Profiled Issuer as well as any such forward-looking statements. Any forward looking statements we make in the Information are limited to the time period in which they are made, and we do not undertake to update forward looking statements that may change at any time; The Information is presented only as a brief "snapshot" of the Profiled Issuer and should only be used, at most, and if at all, as a starting point for you to conduct a thorough investigation of the Profiled Issuer and its securities and to consult your financial, legal or other adviser(s) and avail yourself of the filings and information that may be accessed at www.sec.gov, www.pinksheets.com, www.otcmarkets.com or other electronic sources, including: (a) reviewing SEC periodic reports (Forms 10-Q and 10-K), reports of material events (Form 8-K), insider reports (Forms 3, 4, 5 and Schedule 13D); (b) reviewing Information and Disclosure Statements and unaudited financial reports filed with the Pink Sheets or www.otcmarkets.com; (c) obtaining and reviewing publicly available information contained in commonlyknown search engines such as Google; and (d) consulting investment guides at www.sec.gov and www.finra.com. You should always be cognizant that the Profiled Issuers may not be current in their reporting obligations with the SEC and OTCMarkets and/or have negative signs at www.otcmarkets.com (See section below titled "Risks Related to the Profiled Issuers, which provides additional information pertaining thereto). For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity-based compensation in the companies it writes about, or a combination of the two. For full disclosure, please visit: https://www.cannabisfn.com/legal-disclaimer/. A short time after we acquire the securities of the foregoing company, we may publish the (favorable) information about the issuer referenced above advising others, including you, to purchase; and while doing so, we may sell the securities we acquired. In addition, a third-party shareholder compensating us may sell his or her shares of the issuer while we are publishing favorable information about the issuer. Except for the historical information presented herein, matters discussed in this article contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, is not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this release. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, may from time to time have a position in the securities mentioned herein and will increase or decrease such positions without notice. For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. Emerging Growth LLC dba TDM Financial, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity- based compensation in the companies it writes about, or a combination of the two. For full disclosure please visit: https://www.cannabisfn.com/legal-disclaimer/.

Copyright © TDM Financial LLC · All Rights Reserved · Privacy Policy · Legal Disclaimer

loading