HIKU Brands (HIKU.C) returns to the motherland. Jamaica bound, mon!

Ok so at first glance selling weed in Jamaica seems like a play on par with selling ice in Nunavut or coal in Newcastle. Weed is a national symbol there – its woven into the cultural and national identity like hockey and maple syrup is in Canada. Today HIKU announced it was partnering with Kaya Inc., the first licensed producer and dispensary operator in Jamaica.

HIKU is one of our clients and you can see our past coverage here (including when they used to be called DOJA)

[Jamaica and Weed Joke Here]

Would it surprise you to learn weed was only decriminalized in 2015 and still isn’t fully legal? Right now medical marijuana is legal and recreational use has been decriminalized. Possession of 2 oz. brings a whopping fine of $5.

The Jamaican government isn’t stupid, the bump in tourism alone if Jamaica leans into it’s historic reputation could be enormous. It makes sense to start developing it’s legal weed sector as quickly as possible.

I’m sure the move would have happened years ago save for the fact that the U.S. was ready to lower the diplomatic boom on any country that broke with it’s anti-pot policy. The political winds have shifted, and Jamaica is tacking it’s boat to the new heading.

HIKU, KAYA, KAYA, HIKU – you kids play nice and make lots of money.

HIKU is going to buy 10% of Kaya. Together they plan to set up a tidy little exchange program, sharing genetic material (plant, not human, get your head out of the gutter) and open co-branded lounges and dispensaries.

This is a branding win-win. HIKU benefits from a legal, aboveboard source in Jamaica it can leverage the hell out of in marketing and advertising, and Kaya gets a stable first world production partner who already has lots of experience navigating the wacky world of legal international weed sales. (That’s a crazy developing area we should do deep dive into soon).

Alan Gartner, CEO of HIKU says it thusly:

“his is an incredible opportunity for Hiku to tap into Jamaica’s world-renowned cannabis community and take our retail and branding expertise global… …The Hiku team is excited to share in Kaya’s vision to provide an authentic-to-Jamaica cannabis retail experience… …Jamaica has such a deep and rich history with cannabis and we are fortunate to be able to participate in and learn from that history.”

Exactly Alan. 

HIKU is getting this 10% for an initial $250K investment and a further equity deal (not yet disclosed) which will get them the rest of the way. 

Frankly to me, the marketing value of the Jamaican brand in this space is worth at least that much, so this is a really smart play by the HIKU team. I hope the market realized the value of this move – the stock has been victim of the weedpocalypse and struggling since then.

Frankly, I think these guys are the closest to seeing their stock price match their potential as a company. Lots of producers are talking about international expansion and diversification, but HIKU is you know… actually doing it.

Disclaimer: ALWAYS DO YOUR OWN RESEARCH and consult with a licensed investment professional before making an investment. This communication should not be used as a basis for making any investment.

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