AMAZON GOES GREEN
Amazon throws support behind the States Reform Act
It already had the support of Charles Koch’s Americans for Prosperity group, but now Amazon is also lending its support to Republican Congresswoman Nancy Mace’s federal cannabis legalization bill, reports Forbes.
Does Amazon want to sell cannabis?
Actually, it has much more to do with its workforce. “It opens up the hiring pool by about 10%,” Mace explained. (Amazon, for its part, relaxed some of its drug-testing policies last year.)
The States Reform Act would:
- Federally legalize cannabis
- Institute a business-friendly low federal excise tax of 3%
- Regulate cannabis like alcohol
- Generate approximately $3 billion in tax revenue by 2030
The takeaway
Mace’s bill is unlikely to pass. But even if they disagree on how it should be implemented, cannabis legalization is supported by both parties. “There are three things that really bring people together—animals, Britney Spears and cannabis,” Mace said. “Those are the three things I’ve found that have struck a chord with the American people and that can bring people together at the dinner table—just like apple pie.”
Enjoy Cannabis Daily each morning at 7 a.m.
WELCOME TO NY POLITICS
MedMen lawsuit accuses Gov. Kathy Hochul of pushing ‘bargain’ acquisition
A lawsuit filed yesterday by MedMen alleges that Gov. Kathy Hochul’s office inappropriately influenced Ascend Wellness’s $75 million acquisition deal to go through after an Ascend exec attended a fundraiser for the politician just days earlier, reports the New York Post.
According to the lawsuit, which has not been tested in court:
- Manhattan law firm Feuerstein Kulick, which is reportedly involved in cannabis and licensing, hosted the fundraiser on Dec. 8
- Several Ascend execs attended
- MedMen wanted out of the deal, which would have expired Jan. 1 without state regulator approval, out of concern that the price was too low
- With Kochul’s cannabis-friendly administration replacing Cuomo’s, the value of MedMen’s licensed dispensaries would have been higher
- On Dec. 28, Hochul’s brand new Office of Cannabis Management and the Cannabis Control Board approved the deal
Hochul’s office is denying involvement: “These allegations are full of falsehoods, including a meeting that never took place,” said a spokeswoman. “None of the Governor’s senior team members named here have ever met with these individuals.”
📉 AND STAYING OUT
Cantor Fitzgerald analyst warns cannabis stocks won’t rebound in 2022
Predictions that cannabis banking reform is on its way is “wishful thinking,” warned Cantor Fitzgerald analyst Pablo Zuanic in a report to clients, and that sector-wide declines can be attributed to stocks reflecting that “nothing happens in the U.S. at the federal level regarding marijuana” in 2022, reports BNN Bloomberg.
According to Zuanic:
- While there is bipartisan support for legalization, productive compromise is unlikely
- Social justice reform and expungements are still on the table
- MSOs will grow and consolidate without interstate trade
- Newcomers will struggle to compete
- Valuations are low, but growth is unlikely for some time
- Canadian companies aren’t a good bet, but Auxly, Organigram, Village Farms could have some opportunity
‘Dead money’
“With U.S. cannabis stocks (including indexes, ETFs) now trading below pre-Nov. 2020 election levels, we believe the scenario that nothing happens in the U.S. at the federal level regarding marijuana reform is priced in,” Zuanic said. “That said, even though we are buyers here, we fear a ‘dead-money’ scenario for US MSO stocks is likely in 2022.”
OUI CBD
Good news for the French CBD industry
France’s highest court has suspended the New Year’s Eve ban on CBD flower sales, reports BusinessCann. Flower makes up about 75% of CBD sales in the country.
On Jan. 24, the court temporarily suspended the ban, stating that health concerns pertaining to flower weren’t valid: “Indeed, it does not appear, at the end of the contradictory investigation and the exchanges which took place during the public hearing, that the flowers and leaves of cannabis sativa L. whose THC content is less than 0.3 % would present a degree of harmfulness to health justifying a total and absolute prohibition measure.”
