A Winnipeg-based company has entered into a $20 million financing deal as it prepares to supply the recreational marijuana market with legal cannabis.
Delta 9 Cannabis announced Wednesday that Cannacord Genuity Corp. is purchasing 7.41 million shares in the company at $2.70 per share.
Delta 9 CEO John Arbuthnot, 27, said the deal, expected to close later this month, will allow his company to move ahead with expansion plans for its 80,000 sq. foot production facility and hire hundreds of workers.
“We are now fully-funded to our 600 grow pod expansion,” said Arbuthnot. “Which means increasing our production capacity from the current thousand kilos or so annually up to about 17,500 kilos.”
“It means that we will be able to bring substantial supply to the table for legalization next year and create, I would say, a very substantial number of jobs as well here in local community.”
Delta 9 is currently one of only two Manitoba companies licensed by the federal government to produce marijuana for medical users.
The company currently has 65 employees, mostly based in Manitoba.
Arbuthnot said the expansion could mean between 200 and 300 new jobs at its production facility and the possibility of an additional 100 jobs if its bid to open retail stores in the province is successful.
“It really is the full scope,” said Arbuthnot. “It’s everything from sanitation, janitorial, processors or the people who are hands-on trimming and processing the plant material. Of course growers and cultivators all the way through to accounting, legal, administrative.”
That’s welcome news for Winnipeg Chamber of Commerce president Loren Remillard.
“We were always very hopeful that once legalization came about that this is the type of economic opportunity that we would be seeing and realize here in Manitoba and we’re ecstatic to hear the news,” said Remillard. “A great example of the economic opportunity that this legalization presents.”
“It’s not by anyway dismissing the social concerns – everything from impaired driving, workplace issues – those are all very important and will need to be dealt with but this is an opportunity.”
Remillard expects more job creation in the lead up to legalization.
Arbuthnot said the expansion will happen over the next 18 months.