Enertopia (
CSE:TOP,
Forum), which was once (for a few fleeting months anyway) the darling of the Canadian weedspace, is finally announcing what most have known for some time now – that it is shrinking backwards and sitting on (to coin an Australian phrase) bugger all.
The company has inked an
LOI to sell their majority owned Burlington, Ontario-based Thor Pharma Corp MMPR applicant, which kills the Enertopia/Lexaria joint venture involving same. They’ve also killed an earlier deal with The Green Canvas, which shoots 6.4m C.TOP shares back to the company out of escrow and finally frees GC to run its own race.
Green Canvas was unhappy with that deal within two months of signing it, with Enertopia’s stock value plummeting and the company unable to raise financing to get the project moving forward.
As I understand it, GC was paid $100k in cash in February 2014 for signing the LOI, and had 19m shares and $900k dangled over their heads as incentive to get their license.
A month later, that looked a great deal as C.TOP stock jumped from $0.24 to a buck. But things quickly went sideways.
The day before the Burlington deal was announced, in April 2014, Enertopia stock was down to $0.47, with the company raising money as quickly as it could before the bottom fell out. At its peak, management boasted a market cap of $77m.
Months later, most of that was gone. Today, the shares sit at $0.035 price, 92% down on those salad days and with a $2.7m market cap.
Enertopia now boasts its 1m shares in Lexaria as being the ‘stable foundation’ on which it will build for the future, along with the ‘potential’ for $750k in payments from the Burlington sale, should that project get licensed going forward. It’s also signed a deal with London Drugs to stock their
V-Love ‘sexual desire gel’ in stores.
Lexaria (
CSE:LXX,
Forum) recently announced it too was
leaving the weed grow business, selling its 49% stake in the Burlington operation to focus on its patent pending bioavailability tech for lipophilic delivery of nicotine and vitamins. They get 500k of their own shares back.
Both Enertopia and Lexaria have hinted that they’re
looking at edibles as a potential next big thing, which isn’t stupid at all.
So who bought the Burlington facility?
Total guesswork here, but could it be Galileo Life Sciences (
OTO:MDRM,
Forum), formerly Modern Mobility Aids, who recently announced an agreement to take out an Ontario based applicant, and was
name-dropped in a recent Enertopia news release bragging about how pulling out of weed growth was a great move, “even though companies like Galileo Life Sciences have managed to navigate Health Canada’s stipulations a bit farther.”
That news release went out as official news for both companies, so clearly they’re working a tag team in some respect, and MDRM did recently announce that one of the two deals it was working on had gone definitive.
But in the Canadian marijuana space, everyone is six degrees from stupid, and so it goes that the always ridiculous Easton Pharmaceuticals (
OTO:EAPH,
Forum) has bounded into the mix, threatening MDRM with all sorts of legal weirdness and vowing it will take over their #2 project, the Aero Farms deal, at Port Perry, Ontario.
Easton had a 49% stake in that deal with MDRM, but blurted out in several of its ongoing series of ‘
barely understandable and ridiculously titled press releases’ that it had heard MDRM was renegotiating its end of the deal and thus
EAPH was considering ending the option and
demanding money back.
MDRM, wisely (since Easton is the drunk uncle of the marijuana world), shrugged and decided that sounded like a good plan. Which, of course, set Easton off on a rampage rant in which it was
shocked – SHOCKED, I tell you! – that MDRM would “erroneously and without just cause” cancel the option agreement.
And like any company run by smart, calm adults, Easton immediately decided that it should yell publicly that it was going to shove MDRM out of their own deal and go negotiate something better with the Aero crew because, you want some of this?!
In a long diatribe that Easton’s management team of CEO Carla Pepe and President Nunzio Valerie Jr sent out on the wires, among other things, they claimed “Easton has on several instances displayed its discontent with what was believed to be unethical business practices exhibited by Galileo,” although where those displays took place is a mystery.
Run-on sentence alert: “Easton believes Galileo (formerly MDRM) breached its agreement with Easton by not disclosing prior issues or problems with its agreement with the private medical marijuana company, and by its continued refusal to provide any type of updates or responses including being able to be involved in any negotiations and possible agreements executed between MDRM and the private medical marijuana Canadian grower as is Easton's right.”
Five lines, four ‘ands’, one comma. Gold.
Also a hoot, a search of that news release finds 11 mentions of ‘Galileo’, with each one followed by ‘(formerly MDRM),’ just in case you forgot after the first one that Galileo was, you know… formerly MDRM.
This isn’t the first time
Easton has gone off its meds. I’ve written previously about how they were going to sue a blogger that said mean things about them.
The company response to Matt Finston’s negative articles was a communication that was a little unsavory.
“Email screenshots appear to show management inducing Finston to write nice things about the company or “we will seriously consider having our lawyer contemplate launching a lawsuit against you for the market value lost.”
The company responded with a news release, stating, “Easton believes it will soon join with other companies who have either sued Mr. Finston as a response to similar attacks or are in the process of launching lawsuits.”
No such lawsuit was forthcoming, but that same news release featured this, one of my favourite lines in any public company news release ever:
“The Colorado initiatives have since been abandoned for various reasons including the fact medical marijuana is still federally illegal which would cause legal issues for a public company who is involved in growops.”
On the non-bizarre side of town, there’s a new company to add to your RTO watchlist: Soma Labs.
Seven-figure revenue already locked in and the lab isn’t even set up yet.
Naturally Splendid (
TSXV:NSP,
Forum) has had a big week, announcing details about their
POS Biosciences facility purchase and, today, that they had signed a
distribution deal with a Swiss company, Medropharm GmbH, that will add that company’s edible, CBD-rich hemp powder to its product offerings.
“Our cultivation and inventory are sufficient to allow Naturally Splendid to generate annual sales of our cannabidiol (CBD) products at approximately US $10m,” said Medropharm CEO Patrick Widmer.
Medropharm is no small deal. They currently, by their count, have six R&D projects underway, along with 15 products on the market and a crop area of 3.5k hectares.
Here is a video of an extreme close-up of a CBD crystal growing in a petri dish, with muzak, that Medropharm published a few months back. I’m not entirely sure what it’s in aid of, but hey.
And they tweet.
NSP holders were being impatient nerds last week, selling off stock as the company worked out deals like this in corporate silence. I was one of them; I rolled the dice that we’d get through another few days without news, sold some NSP to pay for another stock purchase (which never panned out) and, sure enough, I missed the halt and a 13% jump. Because I’m an idiot.
I’d expect NSP to linger a little around its present $0.455 level while some newly free-trading stock is cleared away, but I’ve re-purchased what I sold and will leave it be for a while; lesson learned.
NSP is doing all the right things to scale up quickly, and doing deals with companies that don’t play. With the
Laguna Blends sale, their
pet care line drawing big praise, the POS Biosciences facility acquisition, the launch of their
bulk ingredient division, their
hiring of NFL (and Millionaire Matchmaker) veteran Mitch Berger, and now the Swiss deal, the pieces are in place. Set it and forget it.
Speaking of pet lines, True Leaf Medicine (
CSE:C.MJ,
Forum) went to a
NY-based cannabis conference and earned themselves, well, a
‘sort of’ mention in a New York Times article.
Affinor Growers (
CSE:AFI,
Forum) perplexes me. They just signed a deal to use their vertical grow tech in a test with the US Department of Agriculture (USDA), which pretty much leaves me all ‘meh.’ In the time between when they announced they’d be growing strawberries for millions of Asian dollars and now, I’ve harvested three crops of the things on my patio, while we still haven’t seen any of Affinor’s harvest.
But - they managed to sign InMed science boffin, Dr Hyder Khoja, as Chief Scientific Officer a short while back, and I know for a fact Khoja is as legit as it gets.
When I last hit Affinor with an editorial shotgun (and felt the semi-literate rage of their investor ‘dawgs’), they were trading around $0.30. Now they’re at $0.105. But they’re still kicking. Somehow.
Speaking of science, I put out an article a while back talking of how
mining companies have lost the plot, aren’t using new tech to bring their techniques out of the Victorian era, and have done next to nothing to build new investors out of the younger crowd currently hitting tech, biotech, weed and even fashion.
Well, Integra Gold (
TSX:V.ICG,
Forum) looks to have been working on exactly what I was talking about. No shocker, coming from a company that has a distinctly young management team that has built that company up to a $100m market cap in quick time, on a patch of land that was considered too broken to benefit from by several iterations of owners before them.
Integra took over a local mill recently, and with that mill inherited scads of historical data – enough data, in fact, that they’re about to
turn it open source and offer $1m to whomever can churn through it and find the best possible drill locations.
It’s the sort of plan that is destined for big media publicity, and a plethora of good targets in return for 1% of their market cap. Not a bad deal on either side.
Integra GOLD RUSH Challenge from Integra Gold Corp on Vimeo.
--Chris Parry
https://www.twitter.com/chrisparry
FULL DISCLOSURE: Naturally Splendid, InMed, True Leaf, and Integra Gold are Stockhouse Publishing marketing clients. The author owns stock in Naturally Splendid and InMed.