Ontario-based MedReleaf filed its preliminary prospectus ahead of its planned Initial Public Offering and has engaged GMP Securities to lead the deal. Most of the Canadian licensed producers have gone public through reverse-merger, with MedReleaf to become the second LP to go public through the IPO process following the recent offering from CanniMed Therapeutics (TSX: CMED) (OTC: CMMDF) at the end of 2016.
MedReleaf, which operates a 55K sq. ft. facility in Markham, received approval from Health Canada earlier this month to begin cultivating at a second facility in Bradford. The larger Bradford facility is 210K sq. ft. and is projected to have capacity of at least 28mm grams per year after completion of the buildout. The company produced revenue of $10.43mm in the quarter ending 12/31/16, making it likely the second largest producer behind Canopy Growth (TSX: WEED) (OTC: TWMJF), which had sales of $9.75mm but subsequently acquired Mettrum, which had sales of $5.29mm.
The prospectus lives up to the billing as “preliminary”, with lots of information omitted. It lists ten selling shareholders but not the size of their stakes or the amount they intend to sell, including CEO Neal Closner, the MedMen Opportunity Fund, Tikun Olam, separate entities controlled by Stephen Arbib, Theodore Wine, Vadim Soiref, Tarik Ouass and Raymond Leach.
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