- Pac Roots Cannabis completed acquisition of Lords of Grasstown Holdings on February 19, 2021
- Acquisition will provide Pac Roots with foothold in lucrative Californian cannabis market, broaden its product portfolio
- Californian cannabis market generated total sales of $4.4 billion in 2020, more than double C$2.6bn value of the entire Canadian market last year
On February 19, 2021, Pac Roots Cannabis (CSE: PACR) (OTCQB: PACRF) (FSE: 4XM) announced the closing of a share purchase agreement with the shareholders of Lords of Grasstown Holdings Ltd., a well-established cannabis motorcycle lifestyle brand with a tremendous following within the motorcycle and legal cannabis communities (https://ibn.fm/pqdNY). Whilst the acquisition is undoubtedly significant in terms of broadening out Pac Roots’ product portfolio, it also heralds Pac Root Cannabis’ entry into the lucrative United States legal cannabis market.
The Lords of Grasstown brand was initially founded in 2013, designed to build upon the success of Lords of Gastown, a lifestyle and apparel brand originally founded in Canada’s Pacific Northwest and which subsequently expanded into California as of 2015. Created to fulfil a growing demand niche, the Lords of Grasstown brand started off by offering street wear apparel and related products, such as a Fight Club-inspired CBD soap line. The brand would later go on to partner with premium Canadian cannabis suppliers in a bid to introduce some of Canada’s highest testing medical cannabis strains within their product portfolio (https://ibn.fm/et6Ac).
The state of California legalized the recreational adult use of cannabis in late 2016. Since then, the Californian cannabis market has grown at an astounding rate, with sales rising to $4.4 billion in 2020 (https://ibn.fm/3ScUa), up 57% relative to the previous year. To put that figure into perspective, the entire Canadian legal cannabis market generated gross sales of C$2.6 billion ($2.09 billion) in 2020, less than half the figure achieved in the state of California alone (https://ibn.fm/tU0x7).
Pac Roots Cannabis has thus far focused its efforts on the Canadian market, having successfully gathered an initial harvest of 105,000 pounds of biomass earlier this year, as part of its British Columbia-centered joint venture with Rock Creek Farms. At the time, PACR revealed that its harvest is being processed and sold in its entirety to the Speakeasy Cannabis Club (CSE: EASY) at a healthy profit margin (https://ibn.fm/8F2Kt). Pac Roots has subsequently sought to expand production, most recently through the acquisition of a substantial, 250-acre restriction-free plot of land in the Fraser Valley—one of the most intensely farmed and productive agricultural districts in Canada.
From an early date, Pac Roots has looked to differentiate itself from competitors through the relentless pursuit of a genetics-based cultivation approach, which has enabled the Company to produce 50 super-elite strains and roughly 350 tested cultivars. That in turn has resulted in PACR maximizing its yields while simultaneously boosting profitability and minimizing labor costs. With the Company now poised to enter the highly lucrative Californian cannabis market, PACR’s focus on a high-quality product coupled with its ongoing efforts to increase supply bode favorably for its growth prospects going forward.
For more information, visit the company’s website at www.PacRoots.ca.
NOTE TO INVESTORS: The latest news and updates relating to PACR are available in the company’s newsroom at http://ibn.fm/PACR
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