ABcann Global Corp (OTCMKTS:ABCCF), like a number of newly minted stars in the cannabis space, has been in correction mode over the past couple weeks. Remarkably, this action comes in step with corrective action also going on in the cryptocurrency space. It’s almost as if the momentum money is receding right now like a tide, and anything that was trading with explosive momentum to close out 2017 and during the first two weeks of 2018 has suffered as a result.
The company just announced that, further to its news release of December 12, 2017, it has completed the acquisition of Harvest Medicine Inc. According to the release, this moves comes “pursuant to the terms of a share purchase agreement dated January 31, 2018, in consideration for, among other things, a cash payment of $1.5 million; the issuance of 1,056,338 common shares in the capital of the Company; and additional post-closing consideration if certain performance milestones, which include certain patient, revenue and profitability metrics, are achieved.”
ABcann Global Corp (OTCMKTS:ABCCF) trumpets itself as one of the first companies to obtain a production license under the Marijuana for Medical Purposes Regulations, which it received on March 21, 2014. It also obtained a sales license on December 31, 2015.
Situated in Napanee, Ont., ABcann has spent the last two years focused on changing the face of medical cannabis.
ABcann intends to be the first company to have repeatable products in multiple continents and to provide standardized medical cannabis to the world. Its flagship facility contains proprietary plant-growing technology, combining the concepts, systems and components to produce high yielding plants, which, in turn, can generate high-quality products that are consistent from batch to batch.
According to company materials, “ABcann was one of the first companies to obtain a production license under the Marijuana for Medical Purposes Regulations, which it received in March 2014. The Company obtained its sales license in December 2015. ABcann’s flagship facility in Napanee, Ontario contains proprietary plant-growing technology, including environmentally-controlled chambers capable of monitoring and regulating all variables in the growing process. This approach and the systems in place allow ABcann to produce organically grown and pesticide-free, high-yielding plants, which, in turn, can generate high-quality products that are consistent from batch to batch. ABcann is able to control environmental and nutrient demands, tailor-made for a particular strain of cannabis, without the variation that is typical when producing large quantities in less-controlled, larger rooms and greenhouse-type structures. ABcann’s modular approach to systems technology eliminates scale-up risk and enables ABcann to expand anywhere in the world and maintain consistency and quality of product. ABcann is expanding capacity in its current facility to approximately 30,000 sq ft and concurrently undertaking its expansion into a new 150,000 sq ft facility in Napanee. ABcann is pursuing opportunities in Germany, Australia, Israel and other jurisdictions as well as exploring the development of multiple delivery vehicles.”
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As noted above, ABcann has been pulling back. But the company just hit the wires with an announcement that it has finally closed its acquisition of Harvest Medicine in a move that could spark some renewed momentum as investors start to see the potential ramifications.
“The acquisition of Harvest Medicine represents further progress toward our goal of becoming a vertically integrated medical cannabis company,” said Barry Fishman, Chief Executive Officer of ABcann. “It is one of the fastest-growing medical cannabis clinics in Canada, with an aggressive expansion plan and a patient-focused approach that is aligned with ABcann’s philosophy of quality and innovation. We look forward to working with Shekhar to integrate Harvest Medicine into ABcann as we continue to execute on our strategic vision.”
“This transaction will allow Harvest Medicine to rapidly accelerate our expansion plans and bring our highly rated, patient-centric approach to patients in need. I am also personally looking forward to joining the executive team at ABcann and contributing to the continued dynamic growth of the company,” commented Mr. Parmar, Chief Executive Officer of Harvest Medicine.
Now commanding a market cap of $329.3M, ABCCF has a significant war chest ($43.4M) of cash on the books, which compares with virtually no total current liabilities. ABCCF is pulling in trailing 12-month revenues of $453K. However, the company is seeing recent declines on the top-line on a sequential quarterly basis, with revenues falling at -32.8% as of its latest reporting period. We will update the story again soon as developments transpire. Sign-up for continuing coverage on shares of $ABCCF stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $ABCCF, either long or short, and we have not been compensated for this article.