Acquisition of Canadian company by Jones Soda represents ‘an important step’ towards cannabis expansion

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Jones Soda Co., headquartered in Seattle, reports that it has advanced its goal of expanding into the cannabis beverage space with the acquisition of Vancouver-based Pinestar Gold Inc..

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Jones Soda announced this week it completed the previously announced acquisition of all issued and outstanding shares of Pinestar, a gold mining and exploration company that Jones says will help it achieve its green prospects.

Pinestar shareholders received common stock of Jones. Beyond the acquisition, Jones has raised US$11 million in concurrent funding.

“By completing the Arrangement and the concurrent financing, we have taken an important step towards implementing the Company’s planned expansion into the cannabis space,” said Mark Murray, President and CEO of Jones. Soda, in a company statement.

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Murray reports that proceeds from the financing “will be used for the development of the company’s planned cannabis-infused beverages and edibles business.”

In one filing with the United States Securities and Exchange Commission Last October, Jones cited his plans “to develop and commercialize THC/CBD and/or cannabis-infused beverages and edibles.”

The filing further stated that the company strives to “successfully develop and launch new products that align with consumer beverage trends.”

By acquiring Pinestar, it “allowed us to become a public information company in Canada,” Murray points out, the company’s press release adding that the Canadian Securities Exchange (CSE) “has conditionally approved the listing of Jones actions at the CSE.”

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Listing Jones’ common stock on the CSE “would not only increase the liquidity of our stock, but would also allow the company to attract potential investors in Canada as well as the United States, as the share of common stock of the company would have an active commercial activity. market on both sides of the border,” says Murray.

Information from the Canadian Cannabis Survey 2021 lists the six most consumed products by people who have used cannabis in the last 12 months. Taking into account the use of several types of products, dried flowers were consumed by 68% of respondents in 2021, cannabis edibles by 53%, cannabis drinks by 16%, vape pens and cartridges cannabis by 29%, oral cannabis oil by 26%. percent and hash/kief 18 percent.

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But adoption of cannabis drinks has been slow. According to Bloomberg, Canopy Growth supports changing regulations to loosen limits on the number of cannabis-infused beverages a consumer can purchase in a single transaction.

“Consumer adoption of this format has been slower than expected due to the treatment of cannabis-infused beverages as part of equivalency calculations,” Bloomberg quotes Sean Webster, Canadian government and stakeholder relations manager for Canopy.

“The promise of many large cannabis companies lies in the ability of their cannabis drinks to appeal to the non-cannabis consumer,” said Pierre Killeen, executive director of the Cannabis Institute, already written for The GrowthOp.

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That said, cannabis drinks may be best positioned to overcome this hurdle, suggests Killeen. “A drink containing 2 mg of THC has a subtle effect, comparable to a single serving of alcohol. Yet without the ability to market to non-cannabis consumers, cannabis beverage companies will struggle to make the leap into the beverage mainstream.

End of 2020, supplier of cannabis drinks Truss Beverage Co. released survey results showing that awareness of cannabis-related beverages has skyrocketed, with 87% of legal-age Canadians noting that they now know the products exist.

This promise may, in part, explain why more and more players are entering new drinking arenas. This month, for example, Rockstar Energy Drink, a subsidiary of PepsiCo, launched a new line of energy drinks in the United States. which contain hemp seed oil and B vitamins. The products, however, do not contain THC or CBD.

This is not the case for Cann, a celebrity-backed cannabis drink company which announced this week that it has raised more than $34 million in a Series A funding round to fuel its international expansion. The latest investors include Canadian actress Nina Dobrev, as well as Adam Devine and Rosario Dawson, among others.

And last November, Canopy launched two new beverage offersincluding Mud Splashdown, a lemon-lime flavored drink.

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