Cannabis Industry Daily News

New Mexico recreational cannabis licensing draws 1,500-plus applicants

By MJBizDaily Staff

The unlimited number of recreational cannabis business licenses available in New Mexico has attracted more than 1,500 applications from entrepreneurs, and there are likely more on the way.

According to Albuquerque TV station KRQE, the state has received at least that many applications for producer licenses, including 1,000-plus for “microbusiness” permits that limit growers to 200 marijuana plants.

Advertisement

Full producers can grow up to 8,000 plants.

All such licenses may also include a retail component, but producer licenses in New Mexico require some level of cultivation in combination with other business functions.

The upcoming recreational marijuana market in the state is expected to launch in April, and the state will be issuing as many business permits as possible, a regulator told KRQE.

Grow better: MJBizDaily Greenhouse Components Buyers Guide 

Maximize your output and quality with the right equipment. Curated by the editors of MJBizDaily, our new, free Greenhouse Components Buyers Guide helps you choose wisely and covers irrigation, automation and ROI.

Inside:

  • Cannabis greenhouse buyers checklist
    Keep track of everything you need.
  • Pros and cons of common benching systems
    Help weigh out the best choice for your greenhouse benching system with this overview.
  • Cannabis greenhouse Glossary of Terms
    What is evaportranspiration? Download the guide to find out and learn more technical jargon unique to greenhouse and the cannabis industry.

 

“If a million New Mexicans want to get a license, we would license a million people,” John Blair, deputy superintendent of the state’s Regulation and Licensing Department, told the TV station.

That will make New Mexico one of the free-market states in the U.S. cannabis industry, alongside California, Colorado, Oklahoma and Oregon.

Aurora net loss improves on strong medical marijuana sales in first quarter

By MJBizDaily Staff

Edmonton, Alberta-based Aurora Cannabis saw its net loss improve to 11.8 million Canadian dollars ($9.5 million) in its quarter ended Sept. 30 on growing sales of medical marijuana, according to the company’s first-quarter results released Tuesday.

Adjusted EBITDA, a measure of profitability, was negative CA$12.1 million in the July-September period, an improvement over the CA$19.7 million loss in the previous quarter.

Advertisement

Recreational cannabis sales continued to be weak.

In Aurora’s first quarter of fiscal 2022, the company’s adult-use net revenue amounted to only CA$19.1 million, or about half its recreational sales in mid-2020.

On the other hand, medical sales improved to CA$41 million in the first quarter, up 23% from the previous year’s Q1.

In a statement released with the financials, CEO Miguel Martin said the company’s transformation plan is on track.

“We continue to strengthen and transform our business while benefiting from broad diversification across our international medical, domestic medical, and adult recreational segments,” he said.

Solvent or Solventless? We can help.
MJBizDaily Cannabis Extraction Buyers Guide 

Get strategies and tips from expert processors on choosing cannabis extraction systems, costs, safety precautions and more. Curated by MJBizDaily.

Inside:

  • How to choose between solvent-based and solventless extraction methods
  • Learn which strains are most efficient for each extraction process
  • Tips on safety precautions from design to training to protective equipment

Aurora said it has identified savings worth up to CA$80 million, of which it has already achieved more than CA$33 million in savings.

Previously, Aurora said it planned to cut 8% of its 1,643-person workforce.

In a statement to MJBizDaily, a spokesperson for the company said those changes will be rolled out through spring 2022.

Aurora expects some of those employees to move within the business.

For the months ended Sept. 30, 2021, Aurora’s revenue consisted of:

  • CA$43.8 million in Canada.
  • CA$15.9 million in Europe.
  • CA$419,000 in other places not identified.

As of Sept. 30, Aurora had cash of CA$372.8 million.

Shares of Aurora trade as ACB on the Toronto Stock Exchange and the Nasdaq.

New Oklahoma medical cannabis rules include changes to pre-rolls, testing

By MJBizDaily Staff

New rules went into effect Monday for Oklahoma medical marijuana businesses, including allowing medical cannabis dispensaries to package and sell pre-rolls up to 1 gram in weight.

Advertisement

According to The Norman Transcript, emergency rules from House Bill 2646, HB 2904 and Senate Bill 1033 also:

  • Prohibit the operation of a marijuana testing lab while having ownership of or a financial interest in a cultivation operation or a dispensary.
  • Prevent dispensaries from displaying samples of medical cannabis weighing “no more than three grams” in display cases for customers to inspect, provided the samples are not for sale.
  • Strengthen the partnership between the Oklahoma Medical Marijuana Authority (OMAA) and the state’s Bureau of Narcotics and Dangerous Drugs.
  • Allow the OMMA to hire 76 new employees to improve compliance and enforcement.

Growing is all about the lighting: MJBizDaily Lighting Buyers Guide 

Read our exclusive guide for strategies and tips from expert cultivators who have amassed decades of experience studying horticulture lighting. Curated by MJBizDaily.

Inside:

  • Horticultural professionals debunk 8 common lighting myths in cannabis
  • How cannabis extraction companies can reduce energy costs
  • Why experts say the future of horticultural lighting is in LED technology
  • Cannabis lighting Glossary of Terms
  • Buyers checklist

The new pre-roll regulations will benefit dispensaries but likely hurt the licensed processors that, until the change, were the only businesses allowed to package them.

Springbig to go public on Nasdaq via marijuana SPAC transaction

By MJBizDaily Staff

Marijuana industry marketing and loyalty company Springbig plans to go public by way of a merger with Tuatara Capital Acquisition, a special purpose acquisition corporation (SPAC).

The transaction will create a company worth roughly $500 million, including approximately $200 million worth of cash on hand after closing, according to a Tuesday news release.

Advertisement

Springbig serves more than 1,000 cannabis industry clients in the United States and Canada, including more than 2,300 retail locations, according to the release.

The company’s services include text and email marketing, a customer loyalty platform and data analytics.

Tuatara said Springbig’s business-to-business, software-as-a-service model “is on track to deliver $24 million in revenue for 2021.”

Springbig also has “a wealth of data assets driving proprietary insights and has a robust pipeline of multiple potentially actionable M&A targets across various verticals,” the release noted.

The estimated $500 million value of the combined company is based on a price of $10 per share.

Key insights to inform decisions: MJBizFactbook 

Say hello to marijuana business data, curated by the editors of MJBizDaily to help cannabis industry leaders make informed decisions.

  • U.S. marijuana industry financials
  • Licensing, funding and investment trends
  • State-by-state guide to regulations, taxes and opportunities
  • Insights for business and investment strategy

Springbig founder and CEO Jeffrey Harris will continue to lead the company after the transaction closes.

The deal is subject to approval by Tuatara shareholders and other conditions.

Springbig plans to trade on the Nasdaq exchange under the ticker symbol SBIG.

Tuatara shares trade on the Nasdaq as TCACU.

Cannabis software firm Fyllo nets $40M in capital

By MJBizDaily Staff

Fyllo, a cannabis marketing and compliance software company, raised another $40 million in capital to fund growth, mergers and acquisitions as well as attract executive talent.

The deal comes only seven months after the Chicago-based company raised $30 million.

Advertisement

Fyllo now has netted nearly $100 million in capital since August 2020.

Eminence Capital led the $40 million round, according to a news release announcing the deal.

Other venture capital firms that participated include Longview Capital Advisors and ArrowMark Partners.

Details of Fyllo’s valuation or investor equity stakes weren’t disclosed.

Fyllo provides compliance, data and marketing solutions to enable cannabis companies to scale effectively.

Grow better: MJBizDaily Greenhouse Components Buyers Guide 

Maximize your output and quality with the right equipment. Curated by the editors of MJBizDaily, our new, free Greenhouse Components Buyers Guide helps you choose wisely and covers irrigation, automation and ROI.

Inside:

  • Cannabis greenhouse buyers checklist
    Keep track of everything you need.
  • Pros and cons of common benching systems
    Help weigh out the best choice for your greenhouse benching system with this overview.
  • Cannabis greenhouse Glossary of Terms
    What is evaportranspiration? Download the guide to find out and learn more technical jargon unique to greenhouse and the cannabis industry.

 

The company, which bought retail and marketing platform DataOwl in February, said its business has more than doubled this year.

To support the growth, Fyllo has added executives from Twitter, Salesforce and major cannabis brands, the release noted.

Hexo shutting marijuana facilities it recently acquired, laying off 155

author profile picture

Quebec-based Hexo Corp. is shutting down three facilities and laying off staff as part of an integration plan following an acquisition spree it went on this year worth roughly 1.2 billion Canadian dollars ($960 million).

Hexo disclosed the planned closures and layoffs Tuesday in a corporate update.

Advertisement

Hexo is decommissioning facilities in:

  • Kirkland Lake, Ontario, effective Jan. 31, 2022.
  • Brantford, Ontario, effective Jan. 31, 2022.
  • Stellarton, Nova Scotia, effective Feb. 28, 2022.

The Quebec company said some of the 155 affected workers could potentially be relocated to remaining facilities.

The Stellarton, Nova Scotia, facility slated for decommissioning came with its CA$235 million acquisition of rival producer Zenabis in February.

The Kirkland Lake and Brantford facilities joined Hexo in the CA$50 million acquisition of 48North in May.

They were the only facilities owned by 48North, which means Hexo effectively bought some brands and IP.

48North had 145 employees around the time it was acquired by Hexo. Zenabis had 564 employees, per regulatory filings.

No closures related to its CA$925 million deal for cannabis producer Redecan were announced in the corporate update.

In buying the three businesses, Hexo overextended itself.

Solvent or Solventless? We can help.
MJBizDaily Cannabis Extraction Buyers Guide 

Get strategies and tips from expert processors on choosing cannabis extraction systems, costs, safety precautions and more. Curated by MJBizDaily.

Inside:

  • How to choose between solvent-based and solventless extraction methods
  • Learn which strains are most efficient for each extraction process
  • Tips on safety precautions from design to training to protective equipment

In a six-page note accompanying Hexo’s annual consolidated financial statements in October, auditor PricewaterhouseCoopers warned of “substantial doubt” about the company’s ability to continue as a going concern.

“Existing funds on hand, when combined with operational cash flow, are not sufficient to fund existing debt repayments, capex budgets, and potential cash requirements under the Senior Secured Convertible Note,” the auditor warned.

The auditor added that management has been exploring several options to secure the necessary financing.

In October, Hexo appointed Scott Cooper, current head of its beverage joint venture, to CEO as a replacement for founder Sébastien St. Louis, who was recently shown the door.

It’s not the first time Hexo has closed an asset it recently acquired.

In 2019, Hexo bought Newstrike Brands for CA$263 million, along with its massive greenhouse in Niagara, Ontario, only to sell the property for CA$10.25 million less than one year later.

Shares of Hexo trade on the Nasdaq and Toronto Stock Exchange.

Matt Lamers can be reached at matt.lamers@mjbizdaily.com.

South Dakota adult-use cannabis campaign hits signature-gathering snag

By MJBizDaily Staff

A campaign to legalize adult-use cannabis in South Dakota missed an early deadline to submit signatures to the secretary of state’s office in a bid to qualify its recreational legalization question for the 2022 November ballot.

In a video posted to Facebook on Monday, South Dakotans for Better Marijuana Laws (SDBML) Director Matthew Schweich said the campaign fell short of its signature-gathering goals, which would have had to be submitted by Nov. 8 to be considered for next year’s general election.

Advertisement

But, Schweich said, a ruling by a federal judge has given the campaign months of additional runway: A new deadline to submit signatures to the state is May 3, 2022.

The SDBML campaign was cleared in mid-October to begin collecting the roughly 17,000 signatures needed to make the ballot.

That timing gave volunteers only three weeks to reach the signature threshold, and Schweich admitted the campaign fell short on that goal.

He did not disclose how many signatures had been collected to date.

Growing is all about the lighting: MJBizDaily Lighting Buyers Guide 

Read our exclusive guide for strategies and tips from expert cultivators who have amassed decades of experience studying horticulture lighting. Curated by MJBizDaily.

Inside:

  • Horticultural professionals debunk 8 common lighting myths in cannabis
  • How cannabis extraction companies can reduce energy costs
  • Why experts say the future of horticultural lighting is in LED technology
  • Cannabis lighting Glossary of Terms
  • Buyers checklist

“Originally, we did want to get it done by today, to eliminate any legal uncertainty,” Schweich said in the video announcement. “But we think that the deadline extension is something we can use.

“This is a setback, but not a defeat. This is not over. The work continues.”

Schweich added that there are three avenues to victory for South Dakota legalization advocates:

  • A victory in the state Supreme Court – which has yet to rule on a lawsuit that seeks to overturn the voter-approved recreational marijuana legalization ballot measure from 2020.
  • State lawmakers could legalize adult use through legislation.
  • The campaign could make the 2022 ballot and win a second time at the ballot box.

“In the end, one of those three outs … is going to work out,” Schweich predicted.

Report: California’s marijuana social equity programs not meeting goals

By MJBizDaily Staff

A report issued by the California Cannabis Industry Association took a hard look at seven jurisdictions that have social equity programs and found them lacking.

“California’s cannabis social equity programming is not working as intended,” concludes the report, which lambasted the programs for falling far short of their intended goals.

Advertisement

The report was written by the Diversity, Inclusion and Social Equity Committee of the California Cannabis Industry Association (CCIA).

“(Social equity) grants are issued by the state with little accountability, while local programs stall and funds remain unallocated,” the report noted.

“Applicants are waiting years for local approval, yet paying thousands of dollars in rent for property that has yet to be utilized.”

The CCIA report focused on cities and counties that were among the first to receive state funding under a 2018 law, the California Cannabis Equity Act, which provided millions of dollars in grants to Long Beach, Los Angeles, Oakland, Sacramento and San Francisco as well as Humboldt and Mendocino counties.

The report found that, despite well-intentioned plans, the participants in most of those social equity programs had been underserved and unable to get their businesses operational.

Key insights to inform decisions: MJBizFactbook 

Say hello to marijuana business data, curated by the editors of MJBizDaily to help cannabis industry leaders make informed decisions.

  • U.S. marijuana industry financials
  • Licensing, funding and investment trends
  • State-by-state guide to regulations, taxes and opportunities
  • Insights for business and investment strategy

Many participants in social equity programs, the CCIA found, “experienced a lack of support in times of need and were left without support when the city’s sometimes ill-conceived programs made it impossible for them to begin operating before they ran out of capital.”

The CCIA report offered several recommendations to state lawmakers who might want to improve the programs’ efficacy, including:

  • Create a new oversight committee of equity operators and community members to ensure state funds are utilized appropriately.
  • Adopt a new definition of “social equity” in state law to avoid confusion among various jurisdictions.
  • Bolster financial assistance for social equity participants, including license-fee deferrals, tax relief and help with startup costs.
  • Increase state funding to ensure the programs are successful.

Curaleaf to buy Arizona-based cannabis operator Tryke for $286 million

By MJBizDaily Staff

Cannabis multistate operator Curaleaf Holdings signed a definitive agreement to acquire an Arizona-based MSO in a cash and stock transaction currently valued at $286 million.

The acquisition of Tryke Cos., which does business as Reef Dispensaries, will expand Curaleaf’s presence in Arizona, Nevada and Utah.

Advertisement

It comes after Tryke agreed in September 2019 to be acquired by Cresco Labs.

But Cresco, a Chicago-based MSO, pulled out of the $282.5 million purchase in April 2020 because of “regulatory delays, a decline in capital markets and now COVID-19, which brought additional risk to this transaction.”

The Curaleaf-Tryke deal is expected to close in the second half of 2022, contingent on regulatory and other approvals.

Under the terms of the agreement, Massachusetts-based Curaleaf will pay $40 million in cash at closing and $75 million in cash in equal installments on the first, second and third anniversaries of the closing.

Curaleaf also will pay 17 million shares of stock in equal installments on the first, second and third anniversaries.

In addition, 1 million Curaleaf shares will be paid in 2023 based on the business exceeding certain profit targets for 2022.

Tryke, founded in 2014, is a vertical marijuana business that operates in Arizona, Nevada and Utah. It expects to generate $110 million in revenue in 2021.

Growing is all about the lighting: MJBizDaily Lighting Buyers Guide 

Read our exclusive guide for strategies and tips from expert cultivators who have amassed decades of experience studying horticulture lighting. Curated by MJBizDaily.

Inside:

  • Horticultural professionals debunk 8 common lighting myths in cannabis
  • How cannabis extraction companies can reduce energy costs
  • Why experts say the future of horticultural lighting is in LED technology
  • Cannabis lighting Glossary of Terms
  • Buyers checklist

The company has two retail stores in Arizona, including Phoenix, and four in Nevada, including two in the Las Vegas area.

Curaleaf said it plans to expand Tryke’s cultivation capacity from 30,000 square feet to more than 80,000 square feet over the next three years.

Curaleaf trades on the U.S. over-the-counter markets as CURLF and on the Canadian Securities Exchange as CURA.

Nevada suspends marijuana edibles maker’s license over rules violations

By MJBizDaily Staff

Nevada marijuana edibles manufacturer Kindibles has temporarily lost its business license after regulators found that a product line was not inspected per state rules.

According to a news release from the Nevada Cannabis Compliance Board, the Clark County-based manufacturer was found to have added “thousands of additional products” to a batch of tested products, essentially bypassing state-mandated lab safety testing.

Advertisement

“Each addition of product should be considered a new production run, which requires a separate lab test,” the release noted.

According to the Cannabis Compliance Board, the untested products – which involved 14 SKUs – were sold at 10 retail shops in Nevada,  between June 1 and Nov. 3.

The board also found other “significant deficiencies” during an on-site inspection, including inventory discrepancies in company logs that had not yet been entered into the state’s marijuana inventory tracking system, Metrc.

Growing is all about the lighting: MJBizDaily Lighting Buyers Guide 

Read our exclusive guide for strategies and tips from expert cultivators who have amassed decades of experience studying horticulture lighting. Curated by MJBizDaily.

Inside:

  • Horticultural professionals debunk 8 common lighting myths in cannabis
  • How cannabis extraction companies can reduce energy costs
  • Why experts say the future of horticultural lighting is in LED technology
  • Cannabis lighting Glossary of Terms
  • Buyers checklist

The board voted unanimously to suspend Kindibles’ license indefinitely.

The company has 10 business days to submit a correction plan to the board demonstrating its plans to rectify the issues.

The suspension is the third of the year by the Cannabis Compliance Board.

Earlier this month, the board suspended the cultivation permit of Green Cross of America and fined the company over $500,000 for various violations.

Trade agency to look into cannabis vape firms after CCell patent complaint

By MJBizDaily Staff

The International Trade Commission has begun an investigation based on a trademark- and patent-infringement complaint from Smoore Technology, the parent company of CCell, which produces the majority of ceramic vape cartridges for the U.S. cannabis industry.

The complaint by Shenzhen, China-based Smoore seeks to stop imports of marijuana vaping products sold or made by 38 companies, Bloomberg reported.

Advertisement

The company claims that other cannabis vape businesses are copying its four patented inventions for vape hardware and passing them off as CCell vaping products.

Products named in the complaint are manufactured in Canada, China and Switzerland.

Solvent or Solventless? We can help.
MJBizDaily Cannabis Extraction Buyers Guide 

Get strategies and tips from expert processors on choosing cannabis extraction systems, costs, safety precautions and more. Curated by MJBizDaily.

Inside:

  • How to choose between solvent-based and solventless extraction methods
  • Learn which strains are most efficient for each extraction process
  • Tips on safety precautions from design to training to protective equipment

Law360 reported that Smoore is asking the ITC to issue a permanent cease-and-desist order as well as a limited exclusion order to create a safe supply chain for vape products.

Smoore alleges that the companies are violating Section 337 of the Tariff Act of 1930.

The full list of the companies named in the complaint is available in the court filing.

Power REIT ups funding of Michigan marijuana greenhouse to $25.6 million

By MJBizDaily Staff

Power REIT finalized a lease amendment to fund additional upgrades to a marijuana greenhouse cultivation facility in Michigan.

The Old Bethpage, New York-based real estate investment trust is adding an additional $4.1 million to the facility in Marengo Township, Michigan, according to a news release issued Friday.

Advertisement

That brings Power REIT’s total commitment to the project to roughly $25.6 million for the purchase and improvement of the 556,146-square-foot greenhouse and processing space.

The property is being leased to Marengo Cannabis, a subsidiary of Millennium Cannabis.

The latter is a subsidiary of Millennium Investment & Acquisition Co. David Lesser is CEO of both Power REIT and Millennium Investment & Acquisition.

Grow better: MJBizDaily Greenhouse Components Buyers Guide 

Maximize your output and quality with the right equipment. Curated by the editors of MJBizDaily, our new, free Greenhouse Components Buyers Guide helps you choose wisely and covers irrigation, automation and ROI.

Inside:

  • Cannabis greenhouse buyers checklist
    Keep track of everything you need.
  • Pros and cons of common benching systems
    Help weigh out the best choice for your greenhouse benching system with this overview.
  • Cannabis greenhouse Glossary of Terms
    What is evaportranspiration? Download the guide to find out and learn more technical jargon unique to greenhouse and the cannabis industry.

 

The 20-year lease will provide annual rent of approximately $5.1 million, according to the release.

Per the agreement, Power REIT is funding additional improvements to the property, which is near the town of Battle Creek, on the same terms as the original lease.

The fresh budget for the second phase of the facility will focus on transitioning it from pepper farming to cannabis cultivation, the release says.

Power REIT shares trade as PW on the New York Stock Exchange.