Big Names in Canadian MMJ Industry Merging

Two of Canada’s largest licensed medical marijuana ventures are merging, which will create the country’s first dominant cannabis company.

Tweed Marijuana Inc. said in a release Wednesday that it has entered into an agreement to purchase Bedrocan Canada for shares worth $61 million.

The deal may spur other cannabis producers and dispensers to consolidate to stay competitive with the new company formed by the merger.

The Financial Post reported that 48 companies currently occupy the Canadian cannabis space, which could be far too many given the current dynamics of the market. Other big players in the market – such as Mettrum Health, Organigram Holdings and Aphria – might have to merge as well to increase their market share, remain competitive and avoid becoming takeover targets, according to the Post.

Another concern is that companies outside of Canada will snap up licensed growers and sellers.

PhytoTech Medical, for instance, recently became the second Australian company to enter the Canadian market when it merged with MMJ Biosciences.

Justin Trudeau, a candidate for prime minister, has said he wants to legalize recreational marijuana. If that happens, the rate of consolidation could accelerate, the Post reported.

One comment on “Big Names in Canadian MMJ Industry Merging
  1. Bruce Ryan on

    Given the quarterly reports from both companies, this appears to be a merger to avoid corporate disaster. Government interference, rules, regulations and long delays are designed to strangle the industry. Minister of Health is “outraged” that the conservative governments lost in the Supreme Court (again) over this issue. This time the Court struck at the LAW rather than just the “regulations”.
    The Liberal Party has passed a 77% majority resolution for the REPEAL of prohibition under Constitutional terms.

    Reply

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