Florida's marijuana growers capitalize amid uncertain market

Last edited Fri Apr 7, 2017, 03:05 AM - Edit history (1)

Last November, on the day that 6.5 million Floridians voted to dramatically expand the state’s nascent medical marijuana program, the president of San Felasco Nurseries reported in federal financial filings that the Gainesville growery had just brought in a new partner.

For $6.375 million, a single unnamed investor purchased an undisclosed number of Class A shares in the business, one of only seven in the state permitted to grow and sell medical cannabis. That same day, a firm affiliated with Surterra Therapeutics, a license-holder in Southwest Florida, made the first of three late-year equity sales totaling $10.3 million.

The public filings — reflecting only a portion of the money flowing into Florida’s legal cannabis cultivators — offer a window into the rush preceding the coming boom, with predictions that the state’s patient registry will rise from 7,000 today to as many as 500,000. Just about all of the state’s operators either have recently raised money or are in the midst of a capital push, giving investors a chance to get in on the ground floor of an industry with budding potential.

But the timing is awkward.

As the money comes in, state lawmakers are crafting the parameters for Florida’s growing market, including the framework for future competition in cultivation, processing and distribution. There are no guarantees as to exactly what slice of the market investors are buying into, and the transactions — done with little transparency — are fueling skepticism about the capacity and wherewithal of the companies that could be left to carry Florida’s cannabis caseload for the foreseeable future.

Read more here: http://www.miamiherald.com/news/local/community/miami-dade/article142076874.html