The cannabis industry is spontaneously growing and evolving. It regulates commercial activities to a large extent. However, many countries including the US declared any cannabis operation illegal until recently. But people all over the world are trying to speculate whether it should be authorized or not.
Apparently, cannabis operators figured out a way to create National Brands. They intend to create these brands via M&A of reputable multi-state operators. They are planning to do so in the upcoming two years. And if you’ve traded marijuana stocks, you’ve likely seen an increase in marijuana deals this year.
Who’s Doing Cannabis M&A?
There are some companies, which are associated with the M&A in the US. This includes MedMen, Cresco Labs Inc. and Acreage Holdings. These companies are already one step ahead and have successfully created national brands in the US. Canada is a country where Cannabis activities are federally legal. Operators like Canopy Growth Corporation (CGC) and Aurora Cannabis (ACB) are heavily involved in buying up companies and making their presence felt.
According to BDS Analytics, cannabis sales could be around $5.9 billion in Canada alone. In the US, sales expectancy is roughly $17 billion by 2022. Some Cannabis experts expect the premiere brands will emerge through M&A which will have a US national footprint.
What Will The Future Bring?
These new cannabis brands are positioning themselves for retail sales. Some experts also believe that there can be independent retail stores or even franchises of brands selling cannabis. Moreover, there will be brand royalties, which might result in a retailer selling multiple brands of cannabis.
As the US government banned any marijuana activities, M&A seems to be the best option for any multi-state operators. It will scale up sales and basically be much cheaper for the customers. The multi-state operators will be more active to facilitate brand values.