Canada's largest alcohol broker reveals new partnership with cannabis producer

Sep 13 2018, 3:28 am

A new partnership between one of Canada’s licensed cannabis producers and the country’s largest alcohol brokers has been announced.

The agreement, between CannTrust Holdings and Breakthru Beverage Group means Breakthru will invest in the establishment of a cannabis-focused sales brokerage company and develop a route-to-market platform for CannTrust in Canada, effective when the recreational market opens on October 17 of this year, according to a release.

“Breakthru was the first nationally established beverage alcohol broker in Canada and is the country’s leader in representing top beverage alcohol brands in the marketplace,” said Brad Rogers, President of CannTrust. “Their progressive model, sales technology, infrastructure and extensive relationships across Canada make them an ideal fit for our business strategy.”

Danny Wirtz, Vice-Chairman of Breakthru Beverage Group, said his company is “excited” to work with Canntrust and “leverage our well-established business model, which will put us at the forefront of shaping a high performing organization and socially responsible industry.”

The partnership he added, is “a logical extension of our expertise and provides a new growth opportunity into this emerging market.”

The cannabis sales brokerage operation will reside in a newly-formed subsidiary of Breakthru Beverage Group and will be entirely separate from its beverage alcohol brokerage, Breakthru Beverage Canada.

It will, however, leverage the company’s North American business insights, strategies, technology and analytic tools to be a differentiator in the marketplace.

An affiliate of Breakthru Beverage Group will be purchasing 902,405 common shares of CannTrust at a purchase price of $10.23 per share for gross proceeds of $9,231,600.

“CannTrust has made significant investments in both capacity and innovation with the next generation of products such as edibles and cannabis-infused beverages expected to launch in 2019,” said Rogers. “We have a nano-technology that enables us to produce cannabis-infused beverages neutral in taste, and clear as water. This technology will position us to be a leader in Canada, and in future markets globally.”

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