Aurora (ACB.T) breaks $7 support; ABcann (ABCN.V) acquires Canna Farms & launches sexy rec brand

Today Aurora Cannabis (ACB.T) closed at $6.81 CAD on 20.6 million shares traded. The is the first time Aurora has closed below the $7 support level since December 7th, 2017. It bounced off of that support level in February, April, and May, going on trough-to-peak runs of 59%, 29.3% and 46% respectively, each time it bounced off the low.

On Friday, Aurora closed their deal with MedReleaf (LEAF.T), the acquisition increased Aurora’s shares outstanding from 566.75 million to 936.65 million. We wrote about the MedReleaf deal in a Marijuana Datajam post back in May.

At $6.81, that gives Aurora a market cap of $6.37 billion dollars, and a solid second place in Cannabis pubco market cap behind Canopy ($7.2 billion).

Since the start of July 2018, Aurora is down 26.6%. In that same time period Canopy (WEED.T) is down 11.7% and Aphria (APH.T) is down 3.8%.

ABcann launches first rec brand

In May we reported that ABcann (ABCN.V) was adding muscle to their branding team. Today ABcann launched its first lifestyle brand Fireside. This new look is a dramatic change from their previous medical product lines.

Fireside will be available in three varieties, all grown in ABcann facilities

  • FIRESIDE Black:  a high THC product
  • FIRESIDE Red:  a medium THC product
  • FIRESIDE Gold:  a balanced THC/CBD product

 

Fireside product line

After Canopy’s (WEED.T) recent acquisition of Hiku (HIKU.C) it became very apparent that the conversation around the cannabis sector was switching from production capacity to branding very quickly.

 “Hiku equals brands. Canopy is built on brands. So we combined them,” said Bruce Linton, Chairman & CEO, Canopy Growth.

Brands will be competing for shelf space across the country, because on the shelf is one of few places recreational users will be exposed to innovative products. Packaging and messaging are bound to be important in an environment where The Cannabis Act makes traditional methods of advertising unavailable:

Presenting it (products) or any of its brand elements in a manner that associates it or the brand element with, or evokes a positive or negative emotion about or image of, a way of life such as one that includes glamour, recreation, excitement, vitality, risk or daring are not allowed.

We wrote an in-depth piece on cannabis brands last month, and another one about how companies are approaching the branding and marketing problem two weeks ago.

ABcann halted

ABcann’s stock was temporarily halted today as news of their Canna Farms acquisition broke. ABcann bought Canna Farms for $22 million CAD in cash and 92.5 million in ABCN shares.

Canna Farms operates a grow facility in Hope, BC where they grow 51 unique strains of flower and produce 5 distinct oil varieties. The Abcann deck explaining the deal reports that in the twelve months ending June 30, 2018, Canna Farms generated a net revenue of $9.4 million CAD.

Abcann is hosting an investor conference to go over the acquisition tomorrow morning at 9 AM EST. Listen in at www.abcannglobal.com or call in at 1-855-353-9183 and use the participant pass code: 45136#.

Full Disclosure: ABcann is an Equity Guru marketing client.

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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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