Canabo Raises $8.4 Million at a More than 60% Premium to its Current Share Price

Canabo Medical closed an $8.4 million financing agreement at a more than 60% premium to yesterday’s closing price with Canadian licensed medical cannabis producer Aphria.

Canabo Medical owns and operates CMC Clinics, the largest chain of medical cannabis clinics in Canada. The company trades in both the U.S and Canadian stock markets under the symbols CMM.V and CAMDF, respectively.

Aphria Inc. (APH.V) (APHQF) purchased 6 million shares of CMM.V at $1.40 a share and CMM.V closed at $0.86 yesterday. Aphria now owns approximately 16.6% of Canabo’s total issued and outstanding common shares (on an undiluted basis) and we are favorable on this strategic investor.

An Execution Story

Earlier this month, Canabo announced a letter of intent with Peak Medical Group. Under the agreement, Peak will provide clinic space and physicians to assess up to 20,000 new patients under Canabo’s medical marijuana assessment, prescribing, educational procedures and protocols. 

Peak Medical Group immediately began to provide training for up to 60 physicians and educators in Canabo’s proprietary training protocols with all resulting patients under this agreement to be enrolled in Canabo’s medical data collection program.

Conducting a Study on 7,500 Patients 

When Canabo first announced Aphria’s investment, the company also announced plans to complete a 7,500 patient observational study with Andrew Davis, Ph.D., of Acadia University in 2017.

The study is expected to publish its initial results in late 2017 and complete study findings in 2018. The study will focus on correlations within the patient database in three specific areas:

1. The relation of opioid use following therapies by condition and patient category
2. The relation of benzodiazepines use following therapies by condition and patient category
3. The change in quality of life measurements following therapies by condition and patient category

An Attractive Opportunity

Canabo benefits from having three primary revenue streams: physician consultations, database subscriptions and independent medical evaluation consulting.

We continue to remain favorable on Canabo and expect to see a favorable reaction from the market today. From a valuation standpoint, Canabo is an attractive opportunity and today’s developments further strengthen our opinion on the company. 

Important Investor Disclosures

Disclosure.  Compensated Affiliate.  This report was authored by and is property of StoneBridge Partners LLC.  All information and data relied upon in drafting this report is publicly available.  The author believes and considers its sources to be reliable, but does not guarantee the accuracy or completeness of any information contained in this report.  Any and all information, data, analyses and opinions are provided for informational purposes only and is not intended, in any manner, as investment advice.  Any projections or other information generated by StoneBridge Partners LLC regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results.  None of the material contained in this report is intended as a solution or offer to sell or purchase a specific stock or any other investment.  This report is not directed to, or intended for distribution or use by, any person or entity that is a citizen, resident or located in any municipality, state, country or other jurisdiction where the distribution, publication, availability, or use of this report is contrary to any governing law or regulation.  The securities discussed in this report may not be eligible for purchase and/or sale in certain jurisdictions or by particular individuals.  It is important that you check any and all governing laws and/or regulations that may be applicable in your jurisdiction.  Investing in securities of issuers organized outside of the United States, including ADRs, entail certain risks.  The securities of non-United States issuers may not be registered with, nor be subject to the reporting requirements of the United States Securities and Exchange Commission.  Please contact a Financial Advisor for professional advice regarding any and all securities investments.  This report is intended for informational purposes only.  StoneBridge Partners LLC’s officers, directors, employees, affiliates, or subsidiaries may have positions in securities covered by StoneBridge Partners LLC.  StoneBridge Partners LLC receives compensation from the company and/or has a position in the securities mentioned in this report

Share

Tags

Michael Berger is Managing Partner of StoneBridge Partners, LLC and Founder of Technical420.com. Prior to entering the cannabis industry, Michael was an Equity Research Analyst at Raymond James Financial covering the Energy Sector. Michael has been featured in publications such as The Street, Bloomberg, US Money News, and hosts various cannabis events across North America.

Top Stories