By Etan Vlessing
Pure Global Cannabis (OTC: PRCNF) has launched an aggressive growth strategy beyond Canada to establish itself as a international force in the cannabis business, Stephen Pynn, the company’s vice president of corporate development, said Friday at the Benzinga Cannabis Capital Conference.
The Brampton, Ontario-based company and its PureSinse cannabis production subsidiary announced a deal this week to acquire an initial 60-percent stake in the Colombian subsidiary of Avicanna in a $20-million cash and stock deal.
“Colombia represents the gateway to South America’s 650 million [people],” Pynn told the conference in Toronto. Pure Global is newly listed on the TSX Venture Exchange.
“We are a brand-new, excited venture-listed LP,” or licensed producer,” he said. “Now with two licenses for Canada and Colombia, we will continue to leverage our technology, IP and our talented team to execute our global strategy.”
A Colombian Production Play
Pynn points to Colombia’s equatorial climate, low production costs and a regulatory framework that allows cannabis production for global export as justification for the investment.
Pure Global’s new Colombian operation has a government license to grow cannabis and manufacture cannabis derivatives.
The Avicanna unit, as a Latin American production hub, will help Pure Global target emerging export markets, Pynn said.
That includes an eye on breaking into Europe — initially with a focus on Germany, Malta and Britain — before the Canadian company explores opportunities in Australia and Asia down the road.
The key to the international gateway growth are plans for Avicanna to build a 1-million-square-foot greenhouse in Santa Marta, Colombia, where production costs are expected to fall well below those of Canadian licensed producers back home, the executive said.
“Using our IP, we expect to produce several-fold greater yields and to do so at a fraction of the cost versus Canadian production.”
The larger Colombian operation will bring Pure Global from the roughly 20,000 kg of cannabis production expected in early 2019 to over 200,000 kg by the end of 2020, according to the company’s forecast.
Canadian Capacity Growth
Pure Global’s phased development strategy began in 2017 with a license to cultivate medical marijuana, Pynn said.
The company has a 20,000-square-foot production hub near Toronto, with a capacity to grow 4,000 kg of product by the end of 2018, he said.
Pure Global is set to expand into an additional 23,000-square-foot of production capacity by retrofitting a warehouse adjacent to its existing Brampton facility, Pynn said.
The company’s goal is to more than double its Canadian cannabis production and processing to an anticipated 8,000 kg of product by the end of 2019.
Pure Global uses proprietary multiponic cannabis farm technology, which Pynn said produces greater yields and a better quality product than traditional cultivation methods while reducing costs.
“This automation method is capable of growing more plants, in less time, and without the use of pesticides or herbicides.”
Daabon Strikes Deal With Avicanna, Becoming The Largest Agro Company To Enter The Cannabis Industry
Why Cannabis Investors Are Eyeing South America
An Avicanna property in Colombia. Photo by Javier Hasse.
© 2018 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
The post Pure Global Cannabis Bets On International Growth With Avicanna Stake appeared first on Cannabis Stock Picks.
Go to OG News Source