Alliance Growers Corp. (CSE:ACG; FWB:1LA) provided an update on the milestones achieved. The company continues to execute on its business plan to develop its business strategy that differentiates Alliance Growers from other Canadian cannabis companies. The company is advancing on several key fronts.
The CannaApp announced in a news release on Feb. 16, 2017, is under development and is expected to be in beta testing in the coming months. CannaApp will provide a means for licensed growers and dispensaries to advertise products, facilitating sales and deliveries between licensed growers, dispensaries and customers, as well as aggregating social interactions. The marketplace will be also be user content driven, allowing it to expand rapidly to meet market demands. The marketplace will be a full-service solution to sourcing, variety, selection, sales and delivery.
The CannaApp will be a valuable tool for anybody involved in the cannabis industry, from growers to end-users and all points in between. This would include providers of equipment for growing and extraction, plant nutrients, product packaging, and other service providers in the industry.
The CannaApp will position itself to be the eBay and Amazon of medical and recreational marijuana sales. Due to its user-driven model, the business will be able to expand into the national and international markets, wherever legally available. The CannaApp will also provide unique access to potential customers looking for services that are provided by the cannabis botany centre.
Alumina Partners equity facility financing
On April 6, 2017, Alliance Growers announced that the company had executed on the term sheet for a financing commitment offered by Alumina Partners LLC, a New York-based private equity firm, for a $5-million equity facility in a series of private placements, with an option to extend the commitment up to $10-million.
The company is closing the first tranche this week of the offering by issuing one million units at an issuance price of 10.5 cents per unit for $105,000, representing a portion of the commitment fee in respect of the equity facility. Each unit consists of one common share and one share purchase warrant, exercisable at 21 cents per share for a period of two years. Alliance Growers expects to close larger placements with Alumina Partners at progressively higher prices.
Cannabis botany centre (BRIM)
BRIM will be issued the first tranche of shares in Alliance Growers this week. The development of BRIM, together with additional partnerships and investments, is designed to provide Alliance Growers with the ability to produce revenue from the sale of cannabis and other plantlets under contract, generate revenue from the processing and resale of cannabidiol (CBD) oil in Canada, the United States and offshore, provide cold storage facilities utilizing the one-of-a-kind cryotissue cold storage technology for tissue culture preservation and regeneration as needed on long-term basis, and provide extraction services as retail services for cultivators and create custom profiles for extraction for botanicals oils for the retail market.
Investment in Canwe
Alliance Growers is moving ahead with a strategic investment in Canwe Growers Inc. as part of the company’s business plan of securing long-term plantlet sale contracts for the cannabis botany centre and offtake agreements at wholesale cost for flower to be acquired by Alliance Growers for CBD oil extraction.
On Feb. 21, 2017, Alliance Growers announced the closing of the first tranche of instalment of its subscription for common shares in New Maple Holdings Ltd., the parent company of Canwe. Canwe is an Ontario-based company preparing to apply for a producer’s licence under the access to cannabis for medical purposes regulations (the ACMPR). Canwe has access to a 22-acre property 1.5 hours northwest of Toronto, where it plans to build a facility focused on producing clean, premium-quality cannabis. Canwe has amassed a stellar team which includes licensed producer MedReleaf Corp.’s former head grower and his No. 2 aide, both of whom are expert cannabis growers who intimately know the cannabis cultivation cycle from seed to sale. With Alliance Growers’ four-pillar strategy and Canwe’s experienced team, the two companies plan to work together to form business synergies with the goal of creating a strong presence in Canada’s fast-growing medical cannabis space.
In conjunction with the investment, New Maple and Alliance Growers intend to have a business arrangement for the purchase and sale between the parties of live cannabis plants, tissue culture plantlets, and other cannabis products and services.
Joint venture with Israeli medical cannabis company
Alliance Growers is structuring terms for financing an investment in an Israeli medical cannabis company for a significant equity investment which will lead to a significant portion of its high-grade CBD production.
Included in the discussions is the joint development of land for the growth of high-quality cannabis plants, as legally permitted in an offshore, low-operating-cost jurisdiction. This would facilitate the importation of the CBD oil into various states in the United States, into Canada when legalized and into other countries as permitted.
This joint venture and other similar partnerships are what will make Alliance Growers stand out from other Canadian cannabis companies that are directly affected by Health Canada rules and regulations. Alliance Growers plans to produce and sell more CBD oil from outside Canada.
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