Cannabis production company Red White and Bloom Brands (CSE:RWB | OTC:RWBYF) is expanding its operations into the highly lucrative and operationally strategic state of Florida. Proving once again, it puts its money where its mouth is. The company is acquiring medical marijuana licenses and a considerable site from Acreage Holdings (CSE: ACRG.A.U, ACRG.B.U, OTCQX: ACRDF, ACRHF), which will greatly enhance its current operations.
Entering the smoking hot sunshine state
Combining the lucrative cannabis markets of both retail and medical, there’s big money to be made. And where better to expand than into Florida. The sunshine state has one of the most robust and well-established medical marijuana markets in the US. In 2020, Florida’s cannabis revenue exceeded $1.2 billion!Although Florida currently has 22 licensed operators, only 16 of them are selling cannabis product in the state. Through this acquisition, Red White and Bloom will obtain the licenses to operate medical marijuana dispensaries, a processing facility, and a cultivation facility in the state of Florida.This is a very exciting acquisition for Red White and Bloom because it further cements its US position in a key state. The purchase also includes eight leased stores in prime locations throughout Florida. Plus, ownership of a 113,000 square foot facility that the company can get to work cultivating and processing cannabis. This is situated on 15 acres of land. And if that’s not enough, it also comes with a 4,360 square foot, freestanding administrative office building.
Aggressively embracing avenues of growth
Once complete, this acquisition, along with its additional pending acquisitions (Illinois and California), mean Red White and Bloom will be operating in six of the top 10 cannabis selling states in the US!To make the acquisition, Red White and Bloom has incorporated a new subsidiary called RWB Florida LLC. Through this subsidiary, it will pay Acreage Florida for all of its issued and outstanding shares of common stock. Its aggregate purchase price comes in at $60 million in cash, stock and cash considerations (up front and following certain restrictions).Red White and Bloom is on an aggressive path to achieving prominence as one of the top three multi-state cannabis operators active in the US legal cannabis and hemp sector. This Florida acquisition is a strategic move in its plan to dominate in the major US markets.
As the map shows, Red White and Bloom has a presence widely spread across the US states and not clustered in a small area. This is hugely beneficial to strengthening its brand and getting its name out there among the masses.While it’s moving into these states, the company has made clear it doesn’t want to spread itself too thin. Instead it wants to solely concentrate on a few key places, of which Florida, Michigan and Illinois are its main focus.
Brad Rogers, Chief Executive Officer of Red White and Bloom, commented:
“Our core strategy has always been to focus on a limited number of markets within which to operate at scale, and Florida has always been one of those targeted markets. Today we have our path to entry into the third largest market by revenue in the US and are excited with what we can do with the brands we have amassed as well as the skill to execute on our vision.”
As soon as possible, Red White and Bloom intends to introduce its award-winning Platinum Vape brands into the state. It will also leverage its previously announced rights to the lucrative and well-known High Times branded products. Whereby distributing them through its Red White and Bloom branded stores and tactically elsewhere throughout Florida state.
Having this immediately recognisable branding ready to launch is a real windfall for Red White and Bloom helping it scale rapidly in new locations.
Rising demand and a profitable future
The current US administration is in favour of ending prohibition of cannabis, so Red White and Bloom wants to be well positioned when this time comes. Its ambition is clear and it’s ready to welcome the impending explosion of growth in demand for cannabis and its many derived products throughout the United States.Elsewhere in the world, demand is also hotting up for these products. In Europe CBD is big business and Red White and Bloom is also considering its options in distributing its hemp-based CBD products internationally.The company already has brands in Michigan, Oklahoma and Arizona states, it’s pending acquisitions include California, Illinois & Florida. The company hopes this Florida deal will conclude in Q2 2021, and then The Sunshine State is its oyster.Company CEO Brad Rogers has an impressive track record in the US cannabis capital markets and has helped make many investors very rich.Red White and Bloom is a company trading at a deep discount to its rapidly growing potential. Interested parties should watch this space.
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