There’s a huge investment opportunity unfolding right now, and it’s going largely unnoticed. It’s based on a global movement to essentially legalize a plant. As wild as it sounds, this plant is still criminalized in most of the world, despite its proven medical and recreational benefits. Mentioned in today’s commentary includes: THC Biomed International (OTC: THCBF), Zynerba Pharmaceuticals (NASDAQ: ZYNE), Compass Diversified Holdings (NYSE: CODI), Teva Pharmaceuticals (NYSE: TEVA), Aurora Cannabis Inc (OTC: ACBFF)
The movement began in the U.S. with a few states in what many considered an ambitious social experiment…but it was so successful, and more importantly, profitable, that Canada decided to follow suit. This was just the beginning.
Now, with Canada’s recreational marijuana legislation set in stone, one small company is turning to lucrative markets across the globe, including Europe, Latin America and the Caribbean – with 1.37 billion potential consumers.
The playbook is simple: Scythian Biosciences Corp. (SCYB.V; SCCYF) is an investment company for pot projects in countries around the world. The company identifies, acquires and flips key businesses – netting a huge profit along the way.
They’ve taken a global ‘first mover approach’ which gives the company a unique advantage against the competition. Scythian is the world’s first global cannabis incubator, and they’re already making some game-changing deals.
After closing the sale of their projects in Colombia, Jamaica and Argentina, they’ll have over $200 million in cash and stock. Despite this tremendous score, they’re still hungry for more.
Scythian is pushing to continue to diversify its strategy, growing into a key investment company in the marijuana business.
Here are five key reasons to keep watch on Scythian Biosciences Corp.developments:
#1 Canada‘s Cannabis Boom is Well Underway
On June 7th, Canada finally approved the Trudeau administration’s landmark legislation to end cannabis prohibition in Canada. Experts estimate that legal marijuana sales in Canada will reach close to $22 billion by 2021 – more than the combined Canadian sales of beer, wine and spirits. This is why companies like Scythian Biosciences Corp. (SCYB.V; SCCYF) are poised to see huge opportunities.
Legalizing recreational marijuana could result in demand of about 400,000 kilograms of cannabis in its first full year, according to Canaccord Genuity analysts. That’s just for recreational use.
Demand for medical cannabis is also growing at a significant pace, and the total combined demand for the first year could be 575,000 kilograms.
With a population of just 36 million – Canada is dwarfed by the 1.37 billion potential cannabis consumers located in progressive, high income jurisdictions of Europe, Latin America and the Caribbean.
#2 There Will Be a $57 Billion Market Up For Grabs
Cannabis industry leaders know they can’t stop there, however. So now they’re pursuing international expansion to justify long-term market cap growth. And Scythian Biosciences Corp. (SCYB.V; SCCYF) is taking it one step further.
The company is actively identifying and pursuing cannabis startups around the world – and the potential opportunities are staggering in scale.
Germany – Europe’s largest economy with roughly 83 million people – legalized marijuana for medical use for some ailments in 2017.
Italy – with roughly 60 million people and Europe’s fourth largest economy – legalized medical marijuana for certain use-cases in 2013.
In January 2017, Brazil – with a population of over 207 million people and the highest GDP in South America – issued its first license for a cannabis-based medicine.
Experts are projecting that global spending on legal cannabis will grow from its current level of just under $10 billion to a whopping $57 billion in the next ten years. Scythianis an early mover in markets including Europe, Latin America and the Caribbean – with a total population of 1.37 billion.
This year it became the first multinational to receive an Import License for CBD oil by the Argentina Ministry of Health through their soon-to-be-acquired subsidiary – ABP S.A. This deal would give Scythian access to Argentina’s network of hospitals, doctors, retail pharmacies, private health providers and public health system. And in March 2018, Jamaican authorities granted Marigold Jamaica Products Ltd., five conditional licenses to research, cultivate, process and market medical cannabis. A company in which Scythian plans to acquire a controlling stake.
Scythian is building a portfolio in the global cannabis industry that it then sells off at a healthy profit, when the targets successfully develop with Scythian’s help.
#3 Partnerships With Some Of The Biggest Companies In The Space
In February 2018, Scythian Biosciences Corp. announced the closing of a $28.7 Moffering, led by a $14 million investment from Aphria Inc.. This investment makes Aphria Inc. a major stakeholder in Scythian Biosciences Corp.
With a market cap of $2.77 billion – Aphria Inc., is one of Canada’s leading producers, suppliers and sellers of high grade, low-cost medical cannabis. This is where Scythian’s genius is truly realized.
On Tuesday, July 17th Scythian announced the sale of their Latin American and Jamaican assets to Aphria for $193,000,000 mostly in stock. Scythian originally contracted to acquire those assets for approximately 65M USD assuming a $4 CAD share price.
The transaction will turn Scythian Biosciences Corp. into Aphria‘s single largest stockholder – and leave Scythian with a war chest of over $200 million in cash and stock.
#4 A World Class Management Team
CEO – Rob Reid
Mr. Reid is a leading business figure in Europe’s legal cannabis industry. He is co-founder of Prohibition Partners, a company that provides market data and intelligence to investors, entrepreneurs and regulators. He is also co-founder of Cannabis Europa, a conference series that will focus on the science and policy required to shape the future of Europe’s medical cannabis industry.
Chief Medical Officer – Michael Barnes
Professor Barnes MD FRCP is a leading world authority in neurological rehabilitation and has emerged as an influential voice in medical cannabis policy in Europe. Professor Barnes is a clinical neurologist and consultant in rehabilitation medicine.
He is the Honorary Professor of Neurological Rehabilitation at the University of Newcastle, and Founder and President of the World Federation of Neurological Rehabilitation. Notably, he was the first doctor in the United Kingdom to be granted the ability to issue a medical prescription for cannabis to a child with an ailment.
#5 The Best Playbook In The Game
The sale of Scythian Biosciences Corp. (SCYB.V; SCCYF) LATAM and Jamaican assets for $193 million is company making news – but it’s not the end of the story. Management is already planning the proceeds for new acquisitions.
Scythian just announced it granted to Aphria a right to purchase up to 90% of the issued and outstanding common shares of an entity in Brazil which Scythian is currently seeking to acquire at terms to be agreed. The playbook in Brazil looks identical to Argentina, Jamaica and Colombia.
The divestiture of Scythian’s LATAM assets clearly demonstrates its ability to identify, acquire and flip profitable projects – and LATAM was accomplished all within a six-month timeframe. For this reason, Scythian has proven it can profit from a new global industry.