Canada: MMJ grower plans IPO with big warnings for investors

A Vancouver cannabis firm with holdings in Alberta and a greenhouse under construction in California expects to debut its shares on a Canadian stock exchange in the coming weeks — with big warnings to investors.

Sunniva Inc. will be the first pot stock to hold an initial public offering after securities regulators set out new rules for companies with assets in the United States, where cannabis remains federally illegal.

While several U.S. states have liberalized cannabis laws, securities watchdogs in Canada say there are risks with investing in cannabis stocks that have American assets, including that the companies face potential asset seizures and prosecution by federal U.S. authorities.

Last month, the Canadian Securities Administrators, the umbrella group for provincial and territorial securities watchdogs, issued a notice outlining the warnings that publicly traded pot companies with American holdings must make to investors.

Sunniva, which has received conditional approval to list its shares on the Canadian Securities Exchange, said Monday it is confident it has jumped through all the various hoops to satisfy concerns from the regulators.

Leith Pedersen, the firm’s Calgary-born president, said investors and big lenders financing construction of its production facilities in Canada and the U.S. don’t appear to be fazed by any risks of operating in a legal grey area.

Read more at the Calgary Herald (Reid Southwick)

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