Management Team of Harvard MBAs and Pioneer of Californian Cannabis Industry Announce the Completion Of US Cannabis Asset Acquisitions
LONDON, May 31, 2016 /PRNewswire/ --
Poised to tap further investor interest, launching second capital raise as cannabis market comes of age
Forma Holdings ("Forma"), an international diversified cannabis company with offices in London and Los Angeles, which operates in legalised, medicinal cannabis markets, announces the completion of its first asset acquisitions and the launch of its second capital raise, targeting at least £10 million for expansion.
This follows the success of a fund raising earlier this year, the proceeds of which were used to acquire Forma's initial US assets in the Southwestern United States.
This latest fund-raise will harness the rapidly growing interest in the US & Europe in the medical cannabis sector. Proceeds will be used to invest in growing the business and expanding in both the US and internationally.
Regulatory momentum and market drivers
Medicinal cannabis is already legal in Canada and 24 US states (most recently, Pennsylvania in April 2016) with more US states expected to vote on medical legalisation in 2016. Five US states have created fully legal 'adult' or 'recreational' markets, and at least three states are expected to vote on recreational use in 2016.
In April 2016, Germany joined other European countries including Italy, in introducing medical cannabis legislation; Australia, Uruguay and Brazil have all announced medicinal cannabis legalisation programmes in the past year.
Global demand for cannabis is forecast to grow at over 30% per year to reach over $29 billion by 2020 and $40-$50 billion in ten years (ArcView Market Research). Catalysed by a wave of changing legislation in states across the world, patients are increasingly using medical cannabis for the treatment of a variety of conditions. The pharmaceutical market also provides a large opportunity, as the medical benefits of cannabis continue to be identified, allowing for the creation of drugs based on the cannabis plant that treat diseases. The vaporizer and edibles market provide growth opportunities as users move to 'healthier' ingestion methods and away from smoking.
Growing the business
Founded by three Harvard MBAs and a pioneer of California's cannabis industry, Forma is based in London and Los Angeles and operates across two divisions:
- Retail and Cultivation Division: medical cannabis assets have already been acquired across the supply chain, in the Southwestern United States, the first of which will be opening in the second half of 2016. Forma will implement a full roll-out programme of cultivation facilities and medical dispensaries, targeting key medical markets initially in the US, then across Europe. Retail and Cultivation operations generate attractive margins, with store payback periods often around six months.
- Life Sciences Division: Forma's Life Sciences division is partnering with top-tier academic institutions to develop understanding and insight into the therapeutic advantages of medicinal cannabis. Forma will ultimately develop a range of cannabis-based drug medications for the OTC and prescription markets.
Gavin Sathianathan, CEO of Forma Holdings, said:
"We are excited as we look to the next phase of our growth. The medical cannabis market is rapidly evolving both in the US and the rest of the world. Teams that blend traditional business skills with knowledge of cannabis operations are best placed to succeed.
"There is now significant interest in the US & Europe in investing in the sector. Forma has established a strong foothold in a short space of time and we have delivered on many of our strategic objectives, including acquiring assets in the US. We have a unique market opportunity available to us and great potential for growth."
SOURCE Forma Holdings
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