ALLIANCE GROWERS (ACG: CSE) THE FOUR PILLAR STRATEGY

FUNDAMENTAL RESEARCH CORP PUT AT FAIR VALUE AT 0.67 ...CURRENT STOCK PRICE 0.41

AT JANUARY 28 2018

57,990,309 SHARES ISSUED & OUTSTANDING 
73,981,298 SHARES FULLY DILUTED
MARKET CAP FULLY DILUET: 31M AT 0.41

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THE FOUR PILLAR STRATEGY

PILLAR 1 - LICENCED MEDICAL MARIJUANA PRODUCERS

BIOCANNATECH

  • late-stage ACMPR applicant based in Quebec. 
  • initial 10,000 square-foot facility. Alliance Growers has the option to lease or purchase the building next door with an area of 20,000 sq. ft. as an expansion, which will yield 38,000 of grow space with the canopy 
  • acquisition is stipulated to consist of $0.6 million in cash and $7.4 million in shares (at a price of $1 per share
  • Projected Gross Revenue is 8 Million per year and With additional approval to expand - 16 Million per year. 
  • Quebec represents approximately 20% of Canada’s population and it is currently under-represented in regards to ACMPR licenced companies

CANWE

  • Canwe offers Alliance the future potential to access international markets with their plantlet product. The private company is based in Ontario and is currently in the review and security clearance stage of the ACMPR licensing process.
  • Canwe has access to a 22-acre property, 
  • Canwe boasts a strong team of highly sought after industry veterans, some of whom formerly worked at ACMPR licensed MedReleaf Corp. (TSE: LEAF).
  • Canwe plans to construct an initial 80,000 square foot cultivation centre, with the potential to expand the centre to 200,000 square feet over two floors. 
  • As per the deal terms, Alliance has subscribed for 375,000 New Maple common shares at a price of $1.00 per share, representing roughly 5% of total outstanding shares

JAMAICAN INVESTISSEMENT

  • at February 27, 2018, the company announced that it had entered advanced stage negotiations with a private Jamaican cannabis company for a “significant strategic investment”.
  • Alliance reported that the private grower had established operations and existing production facilities, as well as licenses to cultivate and process cannabis for medical, scientific and therapeutic purposes. 
  • With a population of approximately 2.8 million, there is also the potential for the local market due to high acceptance of usage among the population.

INVESTMENT IN ISODIOL INTERNATIONAL INC

  • As at November 30, 2017 and November 30, 2016, the Company had 540,000 and a fair value of $793,800. 
  • The shares are held in escrow and will be released in equal tranches on September 18, 2017, March 18, 2018 and September 18, 2018. 
  • At March 13, 2018 ACG is pleased to announce that it has entered into a Business Development Services Agreement with Mr. Stuart Gray that also includes the provision of certain Public Relations Service. Stuart was founder and CEO of Laguna Blends Inc. Laguna acquired Isodiol International Inc. (ISOL CSE, ISOLF OTCQB)

These partnerships secure long-term plantlet sales for the Botany Centre, wholesale cost for flower to be acquired for CBD oil extraction, and ongoing support for the producers

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PILLAR 2

 

THE CANNABIS BOTANY CENTRE

  • On December 28, 2017, Alliance announced that it had entered into a binding Letter of Intent (“LOI”) with WFS Pharmagreen Inc. (“Pharmagreen”) to acquire an equity stake in Pharmagreen’s subsidiary, BC New Co. BC New Co will build and operate the cannabis botany centre.
  • In the US, Pharmagreen currently holds a 100% interest in Canna Companion Products Inc. 
  • Alliance Growers as a strategic partner with Pharmagreen is investing $3 Million dollars for a 30% interest in the Cannabis Botany Center in Mission, B.C..
  • management has advised FONDAMENTALE RESEARCH CORP that instead of a share purchase option, the parties have agreed that Alliance will be given a right of first refusal on future equity raises of BC New Co. 
  • Annual gross revenue from the tissue culture operations are expected to be $50 Million per year with 10 million plantlets produced and sold at $5 per plantlet. 
  • Commenting on the strategic investment in Pharmagreen, Dennis Petke, Alliance Growers' President and CEO, noted "We are very fortunate to be able to strategically invest in Pharmagreen at such a discounted price (0.25 /SHARE) to the anticipated opening public market price of $1/ share.

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PILLAR 3 -- CBD OIL PRODUCTION AND DISTRIBUTION

 

JOINT VENTURE WITH ISRAELI CANNABIS

  • Alliance Growers is finalizing terms on a 20% equity investment in an Israeli CBD Oil extraction company. 
  • ACG will have off-take rights to buy 20% of oil production at or near cost for global distribution high-tech extraction allows for production of the highest quality pharmaceutical-grade CBD oil. 
  • legal 50-hectare grow operation in an offshore, low operating cost jurisdiction 
  • has secured first government permit to grow cannabis with 4-year exclusivity y continuing clinical research on medical cannabis

CBD DANA

  • Alliance announced on March 5, 2018, that it intends to expand the planned cannabis botany centre with the addition of a greenhouse facility which will be capable of year-round harvests of a proprietary strain of CBD. 
  • The strain, named “CBD DANA” has a tested content of 10% CBD and less than 0.03% THC, making it non-psychoactive. 
  • According to the company, this strain exhibits CBD content that is up to 10 times greater than that of regular hemp. 
  • The company intends to build-out an initial 200,000 square-foot green house with production capacity of up to 15,600 kg of CBD cannabis per annum.

CANNA COMPANION PRODUCTS INC

  • There is A planned equity investment into Canna Companion Products Inc. (“Canna”). Canna, a wholly owned subsidiary of WFS PharmaGreen Inc., produces and sells hemp-based pet supplements. 
  • As part of the arrangement, Alliance would invest $300,000 into Canna, and receive exclusive long-term CBD oil supply contracts when Canna expand into the Canadian market (planned for mid 2018 or when recreational marijuana use is legal).

Growth in this side of the business could imply significant future profits, as the cannabis-infused products segment of the cannabis industry exhibits impressive potential for profitability.

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PILLAR 4 Research and Development

  • Botanical Research In Motion International (B.R.I.M.) B.R.I.M. develops and currently holds rights to new technologies for controlled and precise production of cannabis plants, such as the ‘Chibafreen Process’. 
  • BC New Co. will be utilizing these licenced technologies for the production of plantlets at the Mission Botany Centre. The Botany Centre will also allow B.R.I.M. to do continued research on behalf of BC New Co. Tissue-culture cultivation has the potential to become the new standard for the cannabis industry. 
  • The consistency of product lends well to future government regulation of molecular composition and potency. 
  • There is also further potential to apply these same technologies into other agricultural industries

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sources

w.ww.alliancegrowers.com/
w.ww.sedar.com
w.ww.researchfrc.com

 

This DD is for informational purposes only and does not constitute a recommendation to buy or sell any security.