Choom CHOOF, a Canadian medical and adult use cannabis company, signed a letter of intent to purchase an equity interest in an unnamed New Jersey-based medical dispensary applicant through its U.S. subsidiary, Choom Holdings USA Inc.
Why It’s Important
The letter of intent marks Choom's entrance into the U.S. market, starting with medical. If New Jersey approves adult use, the company said it will enter the recreational market, which is expected to launch in 2020.
The New Jersey company's store strategy includes using Choom's medical brand Clarity Medical Centres. It also intends to obtain licenses to operate the maximum allowed number of medical dispensaries.
"This is our first step into the United States, and we are very excited for our partnership with this experienced group to have the Choom Brands in New Jersey," Choom President and CEO Chris Bogart said in a Tuesday statement.
What’s Next
Choom said it plans to assist the New Jersey company in scaling its operations.
Per the agreement, Choom will receive a royalty from the company. Also per the agreement, Choom has pro rata rights to maintain its equity interest in future financings.
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