- TransCanna Holdings has acquired an option to buy a Northern California site with a 196,000-square-foot facility and room for a potential 400,000-square-foot addition
- The existing facility has undergone $8 million in cannabis production-potential upgrades
- The company is contemplating the possibility of using the site for cannabis transportation, extraction, manufacturing, bottling, cultivation and nursery operations
Emerging cannabis branding, transportation and distribution company TransCanna Holdings Inc. (CSE: TCAN) (FSE: TH8) continues to actively develop its market profile for 2019 after recently accepting a Northern California real estate option agreement from the company’s CEO.
The 6.5-acre site has a 196,000-square-foot facility, as well as cannabis packaging and processing equipment and space for a potential 400,000-square-foot grow facility, according to a news release (http://cnw.fm/9NRYv). The seller is experienced in building commercial HVAC facilities to meet U.S. Department of Agriculture standards for safety and sanitation and has previously made a number of improvements to the site, many of which are to USDA standards, and TransCanna Holdings has reached an additional agreement with the seller to retain consultant services and management of the grow facility’s construction, if the company decides to proceed with that second building.
The existing facility is not currently licensed for cannabis, nor is the acquisition dependent on receiving those licenses, according to the company, but, if TransCanna exercises its option to buy the land, it intends to use the facility for transportation and distribution, extraction, manufacturing, bottling, nursery and growing operations. The company expects to lease space to a third-party laboratory testing company, as well.
“With the recent $8 million of tenant improvements performed, this is one of the largest cannabis focused, vertically integrated facilities in California,” TransCanna CEO Jim Pakulis stated in a news release. “The intended use of the facility will be to transfer branded companies that we acquire, or that we create, and bring them inhouse. This means we have complete control over our nursery, grow, manufacturing, extraction and distribution. We believe the consistency in our ecosystem that we can offer, and the scale that we can create, will result in TransCanna owning a portfolio of premium brands that will materially benefit the retailer and their customers.”
California remains the world’s largest marketplace for cannabis sales, despite Canada’s nationwide legalization of the plant last year (http://cnw.fm/Wqp4l).
The land is in an area zoned for cannabis production, and the company intends to submit applications for all appropriate licenses this month. TransCanna Holdings has until March 15 to finalize the purchase if it chooses to continue forward. The company has already reimbursed Pakulis the non-refundable $250,000 he initially paid to acquire the sale option and expects to pay an additional fee to financial advisory company Haywood Securities Inc. if the deal closes, according to the news release.
The agreement marks the latest in a series of developments for TransCanna since the British Columbia, Canada-based company was incorporated about a year and a half ago. In January, the company announced its pending acquisition of Goodfellas Group, LLC, a full-service advertising and marketing agency for the cannabis industries (http://cnw.fm/Em08M). The company also hired Purple Crown Communications Corp. of Vancouver as its investor relations consultant as part of its filing to list with the Canadian Securities Exchange (http://cnw.fm/8xI7X). TransCanna also successfully completed an IPO on the Canadian Stock Exchange in January for total gross proceeds of C$2.2 million, and it gained approval to trade on the Frankfurt Stock Exchange, as well.
TransCanna subsidiary TransCanna Management Inc., which manages affiliate TCMD, has focused on establishing its own place in the niche market for cannabis distribution and transportation companies operating in California. California is among nine states and the District of Columbia that have legalized recreational marijuana use in the United States, but transporting cannabis products in the state remains problematic because of decentralized local and state regulations, which create a disincentive for many potential players. The federal government’s continued prohibition of cannabis beyond approved pharmaceutical and agricultural hemp uses means that companies regulated by the U.S. Department of Transportation are barred from transporting the material, further limiting the pool of potential competitors.
For more information, visit the company’s website at www.TransCanna.com
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