NEW YORK, November 8, 2017 /PRNewswire/ --
http://www.FinancialBuzz.com, a respected source in the financial news media space, today announces an exclusive interview with Cannabis Wheaton Income Corp. (TSX-V: CBW) (OTCQB: CBWTF) Chairman & Chief Executive Officer, Chuck Rifici.
Mr. Rifici shares with us his professional experience, a brief overall of the company, why he is excited about where the future of the company is heading, his views on the overall cannabis sector, especially with Canada's Prime Minister Justin Trudeau vowing to legalize marijuana across Canada by July of next year. The interview provides unique insight into the Company's latest corporate developments, an update on current cannabis transactions, and the overall Canadian Cannabis Sector.
FinancialBuzz.com News Commentary
According to a report by Market Research Future, the North America legal cannabis market was valued about $3.5 billion in 2015, and is projected to grow at an impressive CAGR of over 33% over the period of 2016 to 2021. The report focuses on North America - USA, Canada and Mexico, where USA is the largest market. The research indicates that among the country markets in North America, the U.S. and Canada's companies are accumulating revenue. With strong legalization campaigns, there is a growing approval of possessing medicinal properties, and growing acceptance among end-users.
Some of the change in public perception has proven itself productive during this election cycle, when more states have voted in favor of cannabis legalization for recreational use, including in the state of California, the largest cannabis market, where previously only medical use was legal. Canada is expected to take measures to legalize cannabis for recreational use in 2018. A new research by CIBC World Markets claims legalizing marijuana in Canada could create a $10 billion annual industry, as reported by Global News.
Exclusive Interview with the Chairman & Chief Executive Officer, Chuck Rifici
Q: Chuck Rifici is the CEO of Cannabis Wheaton Income Corp., can you give our readers a brief overview of your experience and a corporate overview/history of how the company came to fruition?
A: I've founded and been involved in the creation of some of Canada's largest and most successful cannabis efforts. I started back in 2012 when I founded Canopy Growth Corporation (formerly Tweed Marijuana Inc.) and built it into 500,000 square feet of thriving cannabis grow capacity. Today, I am CEO of Wheaton Income, an asset management company that invests and supports a wide range of Canadian licensed producers of cannabis, founder and CEO of Nesta Holding Co., a private equity firm that creates wide ranging partnerships and brands within the cannabis industry, and Chairman of National Access Cannabis, a care centre chain helping patients access the Canadian federal medical cannabis program.
I am a chartered professional accountant (CPA), obtained an MBA from Queen's University and a BASc in Computer Engineering from the University of Ottawa. As for the corporate overview, Cannabis Wheaton is a collective of experts and partners with a passion for the cannabis industry, with a shared goal of collaborating to continue to grow a diverse, energetic, innovative and prosperous industry. The cannabis industry in Canada continues to grow at an unprecedented rate. In less than a year from now, the federal government is expected to introduction legislation to legalize recreational adult cannabis use across Canada. At present, LPs are struggling to keep up with cannabis demand from authorized medical cannabis patients. There is only 1.4 million square feet of licensed medical cannabis production facilities in Canada and we believe that 14 million square feet is needed to satisfy the upcoming demand.
Licensed producers (LPs) are moving as fast as they can to prepare for the increased demand, but accessing capital to expand is not easy in Canada, as the major banks will not approve loans. That's where we come in. We created a platform that will serve to address the pressures that are expected as Canada moves to pan-Canadian legalization. We provide LPs and LP applicants with CapEx financing to allow our partners to build or expand their cultivation facility. In exchange for that financing we take back a combination of equity in our streaming partner and a percentage of their cultivation yield for a certain period of time and at a negotiated price per gram. That's the financial part of it, but what makes us unique is that we offer our partners access to our management team, made up of industry leading experts, to help accelerate the growth of their enterprise.
Q: With 2018 approaching fast and Canada's Prime Minister Justin Trudeau vowing to legalize marijuana across Canada by July of next year, where do you see the market heading and more importantly, where do you see Cannabis Wheaton Income Corp. positioned for this type of catalyst?
A: We see a continuation of the current market of increased capacity building and the industry collectively working hard to meet the massive increase in demand that is looming large over the next 6-18 months as we transition from both initial legalization and then adding edibles and other product types in the second phase, expected in 2019.
This trend fits squarely into Wheaton's sweet spot as we have begun and will aggressively continue to fund streams and partners to build out our production platform. We believe Wheaton is positioned to build capacity faster and more efficiently than our peers.
Q: Recently another Canadian cannabis company, Canopy Growth Corp., which you helped co-found, had big news that U.S drinks company, Constellation Brands has agreed to buy nearly 10% stake into Canopy Growth Corp. What are your current thoughts of this transaction and does this bode well for your company?
A: The Constellation Brands/Canopy Growth partnership marks a big step in the progression of our industry. It's big news for validating the incoming market and further normalizing the cannabis industry. Those close to the industry have been monitoring and expecting that big alcohol would step in post-legalization, the timing was earlier than expected. Which is reassuring and the attention around this transaction will unlock further points of capital which is to our benefit as we continue to aggressively fund capacity expansion.
Q: Recently Cannabis Wheaton Income Corp. has been announcing a number of deals in various business segments in the cannabis space, what is the thought process and strategy around these transactions?
A: As a platform, there are many value added components we are building to both service our partners, and facilitate the distribution and value of the product streams we are building. Some investments, such as rights on point of sale in pharmacies or convenience stores are building in optionality to our platform for possible regulatory shifts, at a time when these investments are relatively inexpensive due to their speculative nature. Transactions such as the Rock Garden acquisition, provides us with regulatory tools that we can utilize to reduce execution risk and add value to our streaming partners, and also our Wheaton Licensing participants - the latter of which will make up the next cohort of Cannabis Wheaton's streaming partners.
Q: Please elaborate on the most recent acquisition of all of the issued and outstanding shares of RockGarden Medicinals (2014) Inc. pursuant to the terms of a definitive share purchase agreement dated Oct. 31, 2017.
A: We are pleased to add RockGarden, a licensed producer under the ACMPR, to the Wheaton platform as a tool for expediting additional sites for our partners and for working with great operators to create new partners by assembling the key components to a great cultivation facility and combining that with an expedited licensing process. Under the Health Canada process, it can take years for a new application to be approved, current LPs can expedite their application for additional sites because they have already received government approval to cultivate, store and distribute cannabis.
The government is committed to ensuring Canadians of legal age have access to a safe and reliable source of cannabis. We want to be a part of this and by accelerating our access to additional cultivation, storing and distribution site, we now can more actively be part of the solution. RockGarden also enables direct Wheaton R&D and best practices development that otherwise would not be available to us without holding our own license. As noted above, Rock Garden provides us with a handy regulatory tool that can be used for the benefit of our platform and partners.
Q: Please elaborate on Cannabis Wheaton Income Corp. has entered an exclusive strategic alliance with the corporate owner of a national chain of convenience stores to develop and implement cannabis distribution and retail sale opportunities at all convenience store group locations dated Oct. 16th, 2017
A: Over the next few months, we will continue to see all provinces and territories roll out their distribution models, but for now the distribution in each provincial and territorial jurisdiction is in flux and we also know that the starting regulations will evolve over time. There are many factors the provincial governments need to take into account. We expect that over time, provinces will look to each other to see how their proposed systems are working and share best practices. Manitoba has opted for a public-private plan for cannabis sales, whereas New Brunswick and Ontario are keeping all aspects under their crown corporations. Cannabis Wheaton needs to ensure our partners can strive under any regulatory environment. That's why we are meeting with various groups, to build alliances well in advance of July 2018. We see large convenience store chains lobbying for distribution so it makes sense to include this in our arsenal of potential distribution partnerships to maximize margins on every gram, or gram equivalent, of product produced by our platform.
Q: Please elaborate on Beleave Inc., along with Beleave's wholly owned operating subsidiary Beleave Kannabis Corp., have entered a definitive agreement whereby Cannabis Wheaton will provide Beleave with up to $10-million in non-dilutive debt financing by way of an instrument evidencing a debt obligation repayable in product equivalents (the DOPE note). The proceeds of the DOPE note will be used by Beleave to finance the construction of an expansion facility, which will be situated adjacent to Beleave's current facility outside of Hamilton, Ont. Dated on Oct. 5th, 2017
A: The DOPE Note is a innovative financing instrument that we developed for the transaction with our streaming partner Beleave. The DOPE Note is the first milestone towards a long working relationship with Beleave as we move forward towards a larger streaming transaction with Beleave to finance the build-out of a third proposed production facility. Pursuant to the DOPE Note, we have already advanced the first tranche of $5million to Beleave. Beleave will repay the DOPE Note by paying us a portion of all gross proceeds received from the sale of cannabis from any of Beleave's facilities. Until the DOPE Note is repaid, 85% of all proceeds from the sale of cannabis by Beleave will be delivered to CBW.
Q: What are Cannabis Wheaton Income Corp. next steps to further create shareholder value and what should your current shareholder base and the financial public expect further down in the pipeline in terms of future milestones?
A: With additional capital in hand from the closing of our last financing and RockGarden license, we are continuing due diligence on a number of partner facilities for funding as well as new sites that we can expedite to license with a curated team of operators, construction partners along with Wheaton's expertise to accelerate our capacity building. We've had a successful first 6 month, and our team continues to research and scour the landscape and industry looking for prospective partnerships and opportunities. One of our commitments to our investors is that we provide a very unique opportunity by greatly reducing risk while still maintaining tremendous upside potential. We provide investor returns through royalty streams and capital appreciation, and create an opportunity to invest in a single source to gain access to multiple LPs and platforms, we continue to grow our streams and our partnerships. There's more to come, we have some really exciting announcements that will help shape the strategic vision at Cannabis Wheaton.
About Cannabis Wheaton Income Corp. (TSX-V: CBW) (OTCQB: CBWTF)
Wheaton Income is a collective of entrepreneurs with a passion for the cannabis industry past, present and future. Our mandate is to facilitate growth for our partners by providing them with financial support and sharing our collective industry experience. Our partners all have different visions, voices and brand values, and all share a common goal -- to build a world-class industry based on ethics, diversity, quality and innovation.
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