Canada’s reputation as being friendly and open to the cannabis investor community is well documented. That’s according to Acreage Holdings CEO Kevin Murphy, who recently raised $119 million in private capital and is planning on listing his company in Canada.
Acreage’s $119 million capital raise is likely the largest private funding raise in U.S. cannabis history, the company said in a press release. Part of the proceeds will be used to prepare the company for its impending public listing in Canada. The CSE (Canadian Securities Exchange) has become the “exchange of choice” for U.S. companies like Acreage Holdings as the exchange boasts sufficient liquidity and is trusted among retail investors.
Acreage Holdings is a multi-state owner of cannabis licenses and assets. The company owns cultivation, processing and dispensary operations and has one of the largest footprints of any cannabis company in the U.S. The company is perhaps best known for attracting former U.S. House speaker John Boehner who said his view on cannabis “has evolved” and is now calling for de-scheduling of the drug.
“[Canada] is where we are most welcomed today,” Murphy said Monday on CNBC. “We would love to be public on the New York Stock Exchange or the Nasdaq but in today’s world Canada is where we are headed.”
Why It’s Important
Acreage Holdings could have raised more than $119 million in capital in private financing, but management felt a better move would be to wait for an eventual public offering. In fact, the company could have raised $300 million, which speaks to the “enthusiasm we are now seeing in the space,” Murphy said. Investors are attracted to an expected growth from $7 billion to $8 billion in U.S. medical cannabis sales today to an estimated $100 billion in sales in 2025.
“There is so much room to grow in this space and that is why people believe that now is the time to get in and now is the time to get early,” he said.
The addition of Boehner and former governor Bill Weld to the board will likely be seen as a “watershed” moment for not only Acreage Holdings, but the entire industry, Murphy said. The two notable Republicans are also vital in continuing to change the perception of cannabis from being a “scary drug” with no medicinal value.
“The majority of this country believes medical cannabis should be legal as well as recreational [use],” Murphy said. “And we are just hopeful that Congress listens to their constituents and votes accordingly.”
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