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Cannabis Briefs for October 12, 2021

October 12, 2021

•Calgary, Alberta-based Sundial Growers is acquiring Alcanna for $346 million. Alcanna is Canada’s largest private liquor retailer, operating 171 locations under its brands Wine and Beyond, Liquor Depot, and Ace Liquor. Alcanna holds a 63% equity interest in its strategic partner Nova Cannabis, which operates 62 cannabis retail locations in Canada. The transaction will be conducted on an all-stock basis.

•State lawmakers in Pennsylvania have introduced a bill to legalize adult-use cannabis. The bipartisan bill is sponsored by state senators Dan Laughlin, a Republican, and Sharif Street, a Democrat, and would allow adults to purchase and possess up to 30 grams of cannabis, five grams of concentrate, and 500mg of THC in edibles. The Senate bill joins a separate House of Representatives bill that’s also co-sponsored across the aisle. Governor Tom Wolf, who has been a vocal advocate for legalization for years, told local media that he thinks “the time is right for legalization.” Polling from the spring found 58% of Pennsylvania residents support legalization and a majority support decriminalizing all currently illicit drugs.

•The Parent Company, the California cannabis company whose portfolio includes Jay-Z’s Monogram brand, as well as Caliva and others, is acquiring a retail and delivery company. It has entered an agreement to acquire 100% of Coastal Holding Company for $56.2 million. Based in Santa Barbara, Coastal holds six retail licenses, with five currently in operation, and two delivery depots. The addition will leave The Parent Company with 11 open stores and six delivery depots. The transaction will consist of $16.2 million in cash and $40 million in stock.

•California Governor Gavin Newsom acted on numerous cannabis bills in recent days. Most notably, he signed into law Assembly Bill 45, which allows for the inclusion of hemp-derived CBD in beverages, food, cosmetics, pet food, and supplements. CBD drinks have existed in a gray area for years now pending a decision by the FDA—this clears the way for their production in California. Newsom also approved a bill that authorizes cannabis beverages to be packaged in glass bottles that are clear or any color. Newsom vetoed a bill that would have allowed cannabis billboards on interstate highways.

•Recreational cannabis sales in Illinois held firm in September at $121.7 million. That’s down $200,000 from August’s total and $6 million shy of the high watermark set in July, but still the third-best month for the state since sales began in 2020. Out-of-state visitors now account for almost exactly one-third of Illinois sales, contributing $40 million in addition to the $81.7 million spent by state residents. With sales totals relatively stable over the past several months, Illinois may finally have reached a point where cannabis supply has caught up with demand; however, retail access remains thin in many parts of the state where demand could be waiting untapped.

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