Who: Canadian organic snack foods company Neal Brothers and Newstrike, parent company of licensed producer Up Cannabis (best known for its association with the Tragically Hip and weed strains such as “Grace” and “50MC”).
What: The companies have created a new joint venture to develop, produce, market and sell a line of “CPG-style” edible cannabis products. Newstrike has a 60% stake in the new venture, and has also acquired a minority interest in Neal Brothers.
When: The deal is effective immediately, although products can’t be sold until edibles become legal. That’s not expected to happen until fall 2019 at the earliest.
Why: Some experts believe that edibles could become a $1 billion market in Canada within two years.
How: Newstrike has a 400,000 square-foot growing space in Niagara region, and is adding 200,000 square-feet of grow area and a 60,000 square-foot production facility for cannabis oil and derivates . “It’s very well suited to the next evolution of product development,” says Newstrike CEO Jay Wilgar.
Something to ponder: In markets where edibles are legal, such as California and Colorado, sweet treats like chocolate bars and gummies tend to be the preferred consumer choices. Neal Brothers co-founder Peter Neal won’t say what types of products the unnamed JV will develop, but the company’s expertise is in chips and salsa. He says there are “significant gaps” in the edibles market that could be exploited. “If you can check all the boxes on good, healthy, tasty food, all things that are very important to us, and combine that with cannabis, we’ve got lightning in a jar and something consumers want,” he said.
They say: “Edibles and derivatives have already caught the interest of a lot of people interested in trying cannabis, but certainly are not interested in smoking it the traditional way. This opens up an enormous opportunity for people to try various cannabis products without the stigma associated with smoking it.” —Newstrike CEO Jay Wilgar