Vancouver, British Columbia--(Newsfile Corp. - January 30, 2018) - Cannabis Growth Opportunity Corporation (CSE: CGOC) (CSE: CGOC.WT) is the latest new listing on the Canadian Securities Exchange, trading under the symbol "CGOC" with warrants trading under the symbol "CGOC.WT".
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The company completed an IPO, raising gross proceeds of approximately $38.7 million, from the issuance of 15,513,250 units priced at $2.50 per unit, with each unit consisting of 1 share and 1 warrant, with each warrant exercisable at $2.50 for 24 months.
The syndicate was led by Eight Capital, and included Canaccord Genuity, Haywood Securities, Mackie Research, Beacon Securities, PI Financial and Velocity Trade Capital.
The company plans to invest in an actively managed portfolio of securities of public and private companies operating in, or that derive a significant portion of their revenue or earnings from, products or services related to the cannabis industry. The company plans to invest approximately 60% of its total assets in publicly traded companies and 40% in private companies.
CGOC Management Corp. is the manager and promoter of the company with StoneCastle Investment Management (www.stonecastlefunds.ca) acting as investment manager with respect to the public portfolio.
Medical cannabis is legal in Canada with 86 licensed producers as of January 12, 2018. Starting in June 2014 with 7,900 patients, the ACMPR program has grown to 236,000 registered users in Canada as at September 30, 2017, according to Health Canada. Further, the most recent Health Canada data provides that the production of medical cannabis as at September 30, 2017 is approximately 29,300 kilograms per year.
Although Canadian production is rapidly increasing, a conservative estimate of the initial production
required to meet expected recreational demand is 900,000 kilograms per year. At the current rate of license issuance by Health Canada, the introduction of recreational cannabis will put a significant strain on the supply of cannabis and established producers will have a significant competitive and early mover advantage.
According to Eight Capital, the recreational market, which is expected to be legal by the summer of 2018, is expected to grow to between $6.2 billion and $9.8 billion by 2024, with the low end of this range putting the "unqualified adult use" cannabis market close to the size of the entire Canadian wine market.
For more information, please visit the company's website at www.cgocorp.com, contact Jamie Blundell, President and COO, at 647-946-2462 Ext 1002, or email [email protected].
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