Pot Topics: Cresco to go public in Canada; Farm bill includes hemp legalization
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Pot Topics is a weekly collection of cannabis-related news curated by the Chicago Sun-Times. Here’s the latest news for this week:
- Chicago-based Cresco Labs to go public in Canada on Dec. 3
- Provision to legalize industrial hemp added to federal farm bill
- Massachusetts announces $2 million in recreation pot sales following recent legalization
- Chicago’s Green Thumb Industries announces another quarter of growth
- New Jersey lawmakers move forward with pot legalization
- Ricki Lake brings lauded pot documentary to Chicago
- Director Kevin Smith previews Jay and Silent Bob-branded weed
Cresco Labs to start trading on Canadian Securities Exchange
River North-based Cresco Labs, Illinois’ largest cannabis cultivator, is expected to go public in Canada on Dec. 3 after carrying out a reverse takeover of an existing company.
Cresco signed a binding agreement in October to take over Randsbug International Gold Corp., which explores and acquires mineral property interests in Canada. Cresco sealed the deal after issuing 12,624,054 subscription receipts for a total of $107.3 million earlier this week, according to a statement from the company.
While Randburg was listed on the NEX board of Canada’s TSX Venture Exchange, Cresco will list its shares on the Canadian Securities Exchange under the symbol “CL.”
“Our public listing represents the culmination of nearly three years of unmatched success in winning state licenses in the most competitive, highly regulated cannabis markets and firmly establishing Cresco as an early leader in this emerging industry,” Cresco CEO Charlie Bachtell said in a statement.
“Early on, by realizing that cannabis is a natural fit in the consumer-packaged goods industry, we developed a differentiated and upscale brand strategy that moves across the value chain covering all price points,” Bachtell added. “At the same time, we developed a well-honed business blueprint that enables our rapid entry into new markets where we can capture leading market share right from the start.”
Prior to announcing plans to go public, Cresco raised $100 million in Series D funding, marking the second-largest private funding round for an American pot company.
Cresco currently has cultivation and dispensary facilities in Illinois, Nevada, Pennsylvania, Arizona, Ohio and California, according to Cresco Chief Communications Officer Jason Erkes. The industry leader now plans to open new facilities in New York and Massachusetts, which recently legalized marijuana for adult use.
Industrial hemp legalization included in federal farm bill
Senate Majority Leader Mitch McConnell confirmed Thursday that his proposal to legalize industrial hemp will be added to the 2018 federal farm bill.
Earlier Thursday, leaders of the House and Senate agriculture committees announced they had reached an agreement in principle that includes McConnell’s provision, which would remove hemp from the federal list of controlled substances.
“We are working to finalize legal and report language as well as CBO scores, but we still have more work to do,” according to a joint statement from leaders of the committees.
McConnell hopes to move the bill through Congress before the end of the year. Then, it will be up to President Donald Trump to sign off on the measure. House Agriculture Committee Chairman Mike Conway, a Texas Republican, believes the president will ultimately back the bill, according to Bloomberg agriculture reporter Teaganne Finn.
“I have every expectation he will,” Conaway said Thursday. “I have no indication he won’t.”
McConnell, a Republican from Kentucky, started advocating for hemp in 2014, when he pushed for a provision in the 2014 farm bill that allowed states to research and grow hemp on an experimental basis.
Hemp products sold in the U.S. had an estimated retail value of at least $820 million in 2017, according to hemp advocacy group Vote Hemp. With limited domestic production allowed by law, most hemp is imported. If domestic hemp production wins legalization, those sales will soon eclipse $1 billion and keep growing, according to Eric Steenstra, the group’s president.
Massachusetts pot shops rack up over $2 million in sales in 5 days after legalization
Massachusetts kicked off sales of recreational pot last week when a pair of stores opened their doors in Leicester and Northampton.
The pot shops, which already operated as medical cannabis dispensaries, tallied over $2.2 million in sales over the next five days, according to a statement from the Massachusetts Cannabis Control Commission. On Nov. 23 alone, sales at the stores totaled nearly $480,000.
The slow rollout of recreational marijuana sales is expected to continue for some time in Massachusetts. A third store, in the town of Wareham near Cape Cod, has been issued a final license and could open soon.
For the moment, that still leaves large swaths of the state without easy access to legal recreational marijuana, including all of greater Boston where more than half of the state’s population resides.
Chicago’s GTI announces huge growth in latest quarter
Green Thumb Industries, another leading River North-based pot company, announced another quarter of huge growth on Tuesday.
GTI reported revenues of $17.2 million during the third quarter of 2018, which marks a 26 percent jump from the previous quarter and a 344 percent increase from last year, according to a statement from the company. However, the company notched a net loss of $3.3 million, down from a net income of nearly a half million dollars during the previous quarter.
GTI previously tallied $13.6 in revenues during the second quarter of 2018, when the company went public in Canada through a reverse takeover.
“This was another quarter of solid financial and operational results as we build our foundation for the future,” according to GTI founder and chief executive Ben Kovler. “We have been focused on expanding wholesale capacity to meet increasing demand, opening new RISE stores and are unwavering in our diligent effort building a world-class team.”
“To support our strong retail pipeline, we added experts to the team in retail operations, real estate, design and construction, and marketing and communications from retail giants such as Nordstrom, Starbucks, Home Depot, Whole Foods, Apple and Nike,” Kovler added.
GTI operates eight manufacturing facilities and 60 dispensaries that are spread across multiple states, including Illinois. As of Sept. 30, GTI’s assets totaled $166.2 million, including cash and cash equivalents of nearly $150 million, the statement said. The company’s debt totals $7.6 million, $1.5 million of which is due within the next 12 months.
Lawmakers in New Jersey move pot legalization package
New Jersey lawmakers are pushing ahead with a plan to legalize recreational cannabis in the state.
On Monday, a joint panel of lawmakers from the state Senate and Assembly backed a bill to regulate, tax and legalize the drug. In addition, legislative committees approved measures to expand the state’s medical pot program and overhaul rules for expunging drug-related and other crimes.
The votes were a historic first for New Jersey, but the fight for those on both sides of the legalization debate is far from over. If the bills pass, New Jersey would become the latest state to fully legalize marijuana, and only the second to do so through legislation and not a ballot initiative.
Democrats who control the state Legislature must now move the bills through the Senate and Assembly, although it’s unclear whether supporters have enough votes to make that happen. Those leaders then need to win over Gov. Phil Murphy, a pro-pot Democrat who still hasn’t committed to the current plan.
“I’m encouraged that it’s moving in the right direction, and it’s too early to tell as it relates to exactly the elements that ultimately are in there,” Murphy said Monday. “We’ll see, but I’m happy to see the progress.”
Ricki Lake premieres pot documentary ‘Weed the People’ in Chicago
Actress and former daytime talk show host Ricki Lake visited Chicago this week to screen her critically-acclaimed new documentary “Weed the People,” which focuses on families using cannabis to treat children diagnosed with cancer.
Lake, the film’s executive producer, helmed the project alongside frequent collaborator Abby Epstein, a documentary director and graduate of Northwestern University. The pair last worked together on the 2008 documentary “The Business of Being Born,” an exploration of alternative child birth methods that sharply criticized America’s health care system.
The duo’s latest collaboration premiered last March at the SXSW Film Festival in Austin, Texas. The project tracks the progress of five children as they undergo pot-based cancer treatments for roughly six years. Among the subjects is A.J. Peterson, a young Chicago boy whose family relocates to California to gain access to medical marijuana.
“Weed the People” has been a critical darling, garnering a perfect rating on the movie review aggregator Rotten Tomatoes. Lake and Epstein are now touring the country to promote the film through a series of screenings sponsored primarily by pot companies, including Oak Park-based Pharmacann and Highland Park-based Grassroots Cannabis.
Earlier this week, the duo attended a pair of screenings at the Music Box Theater in Lake View and another private showing at the Regal Webster Place 11 in Lincoln Park. Prior to their stop in Chicago, the Sun-Times discussed the project with the filmmakers.
Kevin Smith announces Jay and Silent Bob-branded weed
Renowned screenwriter and director Kevin Smith announced earlier this month that he partnered on a deal to create branded pot products based on the fictional stoner duo Jay and Silent Bob, who first appeared in his 1994 cult classic “Clerks.”
Smith initially played Silent Bob in a series of films he directed in the 1990s, while his counterpart was portrayed by actor Jason Mewes. In 2001, the fictional dope dealers headlined Smith’s popular 2001 feature film “Jay and Silent Bob Strike Back.”
The new line of products, dubbed Jay and Silent Bob’s Private Stash, will be distributed by California-based Chemesis, Smith said in an Instagram post announcing the deal.
“Back in the day, [Jay and Silent Bob] used to sell weed in the movies,” Smith wrote. “Now, thanks to the good folks at [Chemesis], Jay and Silent Bob are selling weed in real life!”
The line — which includes indica, sativa and hybrid varietals — will be available in January in every state that has legalized the drug, according to Smith, who noted that cannabis-based oils and CBD offerings for pets were also in the works.
Associated Press and USA Today contributed to this report.
Upcoming cannabis events in the Chicago area
- Dec. 1: MOCA hosts a “Get a Card” event. Emporium Fulton Market, 839 W. Fulton Market.
- Dec. 1: Mission Illinois cannabis dispensary hosts “Cannaclass: Tis the Sensimilla Season.” The Woodlawn 1200, 1200 E. 79th St.
- Dec. 8: Mission Illinois cannabis dispensary hosts “Cannaclass: Joint Rolling 101.” Mission, 8554 S. Commercial Ave.
- Dec. 8: Operation 1620 hosts “Cars & Cannabis 2018.” Lucky E’s Garage, 6528 S. Lavergne Ave. in Bedford Park.
Sun-Times Cannabis 101 Guides
- Cannabis 101: A guide to medical marijuana in Illinois
- Cannabis 101: CDB Oil, what is it, how does it work, is it legal in Illinois