Cannabis investors saw a pair of notable moves in popular stocks on Monday, with Canopy Growth (NYSE:CGC) moving 11% and Aurora Cannabis (TO:ACB) adding nearly 7% on the back of exciting deals for both companies.
Canopy Growth on Monday received a license from New York that will allow the Canadian company to process and produce hemp in the state. The move is a part of larger efforts from New York Governor Andrew Cuomo and U.S. Senator Charles Schumer as well as Canopy’s own hopes to break into the U.S. market.
In a company press release, Canopy cited Cuomo’s help in creating the Hemp Research Pilot Program and Schumer’s leadership in passing the recent U.S. farm bill as being instrumental in getting the deal done. The 2018 edition of the farm bill legalized the production of hemp in the United States.
A final location for Canopy Growth’s New York site will depend on a board vote, but the company is currently evaluating a number of spots in the Southern (NYSE:SO) Tier of the state, according to CNBC. Canopy plans to invest up to $150 million in the location, which it hopes will be “capable of producing tons of hemp” annually.
Schumer’s office added in its own release that the company’s investment “is a true win-win for Canopy Growth, who will be positioned at the forefront of Upstate New York's industrial hemp revolution, and for the Southern Tier's economy and farmers, which will receive a major shot in the arm in new good-paying jobs.”
Meanwhile, fellow Canadian marijuana producer Aurora Cannabis announced Monday that it is acquiring British Columbia-based Whistler Medical Marijuana for about $132 million. Whistler is a recognizable brand in Canada and received one of the country’s original 10 licenses to produce marijuana. It was also the first marijuana company to earn organic certification in Canada.
“This transaction adds an iconic, organic certified BC-based brand with exceptional traction and a significant price premium in both the medical and retail markets,” said Aurora CEO Terry Booth.
On top of its recognizability, Whistler offers Aurora a unique opportunity to expand internationally, as it already sells medical cannabis derivatives to Australia and the Cayman Islands. Whistler’s second production facility is expected to be completed this summer and will have a capacity of over 5,000 kilograms per year.
Canopy Growth and Aurora’s deal-making spread optimism to the rest of the marijuana industry during the week’s first trading session. The ETFMG Alternative Harvest ETF (SNX:MJ) gained 1.7% on Monday, underscoring hopes for more major deals that can add legitimacy to the young business.
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