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Cannabis Briefs for December 7, 2021

December 7, 2021

•Jakob Ripshtein, formerly president of Diageo Canada, has been named chairman of cannabis group Humble & Fume. Most recently Ripshtein was CEO of brand strategy group Perennial Brands, and before that he was president of cannabis company Aphria, now Tilray Inc. Johnson Brothers has a deal in place to take an equity stake in Humble & Fume’s California distribution unit upon federal U.S. legalization.

•Constellation Brands CEO Bill Newlands vacated his seat on the board of Canopy Growth. According to a document recently filed with the SEC, Newlands resigned on November 24, effective immediately. His seat was filled by Garth Hankinson, Constellation’s CFO. Canopy Growth saw revenues slip 3% year-over-year for the three months through September, after which came the departures of CFO Mike Lee and chief product officer Rade Kovacevic. Constellation owns approximately 36% of Canopy Growth, along with warrants which if exercised could raise that stake to just over 50%

•Recreational cannabis sales in Illinois held firm above $120 million for the fifth month in a row in November, according to state regulators. Sales were down around $2.6 million from the previous month, sitting at $120.7 million split between $81.7 million from state residents and $39 million from visitors. The figure is the lowest since June’s $115.6 million total but reflects falling prices more than waning demand, as evidenced by the number of cannabis products sold—at 2,769,211 it’s the second-highest number of items sold in a month, behind only July, the reigning sales champ in both volume and value. The state separately released October data for medical marijuana sales, which totaled $31.9 million.

•Treasury Secretary Janet Yellen affirmed that allowing cannabis companies access to banking and other financial services would make it easier for the IRS to collect taxes on the industry. Asked if she believed that was the case during recent testimony before the House Financial Services Committee by Colorado congressman Ed Perlmutter, Yellen replied, “Yes, of course it would.” While large banks still avoid handling money associated with the U.S. pot industry for fear of incurring legal jeopardy, many in the industry question the logic of forcing a highly regulated industry to conduct most of its business in cash. Yellen’s comments stopped short of a full-throated endorsement of the SAFE Banking Act, which would open up the banking system to the industry, but added another point in its favor from officials high in the federal government.

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