CannTrust Holdings (TSX:TRST) announced a strategic investment deal for a nearly 20 percent stake in Australian licensed producer Cannatrek.
As quoted in the press release:
Cannatrek is one of the first Australian vertically integrated enterprises to be awarded a cannabis research, cultivation, manufacturing, sales and import license by federal and state governments and is pioneering a world class 1.7 million [square feet] greenhouse facility, which will position Cannatrek to be one of the lowest cost producers in Australia. This greenhouse project, when completed, will provide significant supply for the Asia-Pacific region and will allow CannTrust to purchase quality, low-cost cannabis from Cannatrek.
“We will continue to invest in strategic alliances with well-positioned business partners to maintain our position as a front-runner in the cannabis industry both in Canada and globally,” says Peter Aceto, CEO, CannTrust. “This partnership with Cannatrek demonstrates CannTrust’s commitment and ability to be a global player in the rapidly expanding cannabis market. The rapid increase in worldwide demand for cannabis offers significant new opportunities for CannTrust.”
As part of the partnership, CannTrust is making an investment of AUD $6.4 million (approximately CAD $6 million) for a 19.8 [percent] stake in Cannatrek, with an option to maintain this shareholding through any future share issuances up to and including Cannatrek completing an initial public offering.