Halo Labs Inc (NEO:HALO) Establish Greater Distribution and Diversification in California
Halo Labs Inc (NEO:HALO) (OTCMKTS:AGEEF) (FRA:A9KN) has taken the first steps toward acquiring a 17.5% interest in Ukiah Ventures Inc (or UVI). This transaction will allow Halo to secure rent-free access to the Ukiah facilities for the first year of the relationship as well as a regular supply of cannabis biomass to process with right of first refusal (for three years – up to a 15,000 lbs. quota per month). It also offers biomass procurement, to produce cannabis oils and distillates more cheaply. Halo will also capture other value-added activities in the cannabis space, such as drying, trimming, packaging, freezing and storing. For those keeping count, Halo will exchange 5,940,000 of its own common shares and exchange them for 1,333,333 common shares of UVI, a cannabis distributor and processor.
[stock_chart symbol=”HALO” align=”left” range=“1Y”]
For Halo, the most important aspect of the UVI transaction is the opportunity to establish a far greater distribution and diversification in California-especially, northern California, which is certainly one of the most important cannabis markets in the world. Indeed, UVI boasts both close relationships with biomass suppliers from farms at competitive prices (primarily in northern California) and distribution channels to processors in southern California.
Experienced cannabis entrepreneurs manage UVI’s 30,000 square foot processing and manufacturing facility in Ukiah, California. The facility has direct access to a major highway, facilitating sales logistics; moreover, thanks to the six-acres it controls, UVI has plenty of land available to meet the most ambitious plans for business growth.
Many cannabis companies will flourish, but others will not succeed. One of the key ingredients for success – quite literally – is the quality of the plant material, used to process the various derivatives, which will provide the ‘value-added’ earnings producing premium, investors will demand. In this respect, Halo’s expansion in California, particularly as far as the agricultural relationships are concerned, cannot be understated.
Given, the cannabis experience of California – apart from the unregulated market, the State has enjoyed a regulated medical cannabis market since 1996 – growers know how to recognize ‘good grass’ when they see it. California cannabis biomass suppliers such as UVI, therefore, understand the importance quality over quantity. By accessing this expertise, through (partial) ownership, Halo will not only benefit from having secure access to top shelf raw material, it will also benefit from the know-how of veteran growers, who understand how to avoid mediocre cannabis. The quality factor has become all the more important, as California has legalized edible cannabis products: the first cannabis café (in the United States) will have opened to the public on September 1, 2019, in West Hollywood to be more precise. The restaurant will offer CBD, THCs enhanced dishes and also allow patrons to smoke and dab during their meal.
This is a historic moment, not only for cannabis, but for the country as a whole. As pioneers in the end of the prohibition of cannabis, we are dedicated to the treatment of cannabis just like alcohol. The first step was to put it on sale. It is now about giving the public access to a safe communal space where cannabis can be consumed without stigma.
Arguably, California has the potential to make some of the highest quality organic cannabis in the world. The US State, moreover, represents the world’s largest market for cannabis. More importantly, it has become a giant laboratory, which the rest of the world is observing in order to adopt best practices. And Halo has found a way to play a protagonist role within it through UVI.
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