Tilray stock price surges after inking deal with Supreme Cannabis

An
employee checks cannabis plants at a medical marijuana plantation
in northern Israel March 21, 2017
REUTERS/Nir Elias

• Tilray
  said Wednesday it had increased the amount of dried marijuana
  it will purchase from Supreme Cannabis, from 2 million Canadian
  dollars to 12 million.
• Shares of Tilray surged on the news, while Supreme was
  mostly flat in early trading.
• 
  Follow
  Tilray’s stock price in real-time here. 
  

Tilray is surging in early trading Wednesday after announcing it
had inked a deal to buy 12 million Canadian dollars worth of
dried cannabis from Supreme
Cannabis for its medical marijuana business.

The agreement is a significant increase in the value of dried
cannabis that Tilray originally agreed to purchase from Supreme on September
10. That deal was for 2 million Canadian dollars worth
— 10 million less than Wednesday’s announcement.

Shares of Supreme, which trades on Toronto’s Venture Exchange and
via an OTC ticker in the US, were up about 0.4% in early trading.

“We are excited to be entering into this agreement with Tilray,
an organization – like Supreme Cannabis – that focuses on the end
user and demands leading quality assurance standards,” John
Fowler, Supreme’s president, said in a press release.

“Tilray has built an industry-leading global 
medical distribution platform, which has resulted in robust
demand for high quality cannabis products. We are happy to
provide 7ACRES premium products alongside Tilray’s well-regarded
and existing lineup to support medical patients around the
world.”

Tilray’s medical-marijuana program has been a source of
significant rallies for its stock price amid the 535% rise since
its July initial public offering. Announcements of supplying
CBD treatments in California and Australia have sent the stock on similar jumps
the days they were announced.

Trials like the one in California are “a positive for both TLRY
and the broader cannabis stock universe,” Vivien Azer, an analyst
at Cowen, said at the time. “As additional medical applications
and improved government support add another domino to future
legalization in the U.S.”

MJ, the only US-based exchange-traded fund that seeks to track
the entire marijuana sector, has risen 18% in September. The
across-the-board rally has caused short-sellers — or those
investors betting against weed stocks —
a world of hurt, but they aren’t throwing in the towel just
yet.

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