This article is written by Tia Moskalenko from AskGrowers
The legal cannabis market in the United States is pretty young, but many experts agree it is an industry with a very bright future. It keeps evolving and growing at an incredibly fast pace, and it seems the trend won’t stop, at least not anytime soon, as more states legalize marijuana use. Plus, the sector is the source of enormous profit. With that said, seeing many big players and highly regulated industries interested in the cannabis sector does not come as a surprise.
Lately, one of the actual topics around the marijuana industry is the creation of monopolies. The fact the topic keeps popping out seems justified, at least to a certain degree.
Merges, acquisitions, and start of monopolies in the marijuana industry
Cannabis companies are highly active in developing new products to attract a larger audience. In addition, the entire market is extremely fragmented. The manufacturers do not have permission to ship their products beyond the state borders. For that reason, consolidation that comes through acquisitions and merges was something many predicted. Many companies in the US focus on obtaining licenses for the production and trade of various weed products, including edibles, as many consumers prefer them.
In the past, the pharmaceutical industry lobbied for pot legalization to be stopped. On the other hand, some companies from the pharmaceutical sector did the opposite thing. They’ve decided to start partnerships with weed companies to develop various medicinal marijuana-based products. Other industries, including tobacco and alcohol, are looking into options that would allow them to get into the pot market in the areas where recreational use of cannabis is legalized.
There have been many mergers and acquisitions in the marijuana market, including Pharmacann and MedMen (OTC: MMNFF), iAnthus (OTC: ITHUF), and MPX (NYSE: MPX). But that’s just a fraction of happenings. In a deal worth $213 million, Cresco Labs (OTC: CRLBF) acquired Bluma Wellness. Ayr Strategies (OTC: CNBQF) acquired Liberty Health Sciences, and Verano (OTC: VRNOF), a multistate operator, purchased Alternative Medical Enterprises (AltMed).