CGrowth Capital Inc (OTCMKTS:CGRA) has been registering small increments to its share value, ever since the company’s announcement of an LOI with Wildfire Cannabis. The LOI would allow CGRA to lease a portion of its properties to grow pot. The deal was finalized in May and the lease would be valid for the next 5-years. The agreement marked the entry of another player in the attractive cannabis industry.
CGrowth classifies itself as a holding company for businesses and assets including mining and commercial real estate. CGRA has been growing on all fronts of its business and has 47-acres of industrial land and over 1000-acres of mineral rights and leases. All of these properties are located in the state of Washington. The lease has been priced at $2 million annually, inclusive of rent, maintenance and other facilities. Additionally, CGRA can increase the base rent by 33% in subsequent years, depending upon the crop output.
Wildfire Cannabis is classified as a tier-3 marijuana company and therefore has rights to manage between 10,000 to 30,000 acres of land for growing pot. This makes it the largest grower in the region. CGRA CEO, Bill Wright, stated that cannabis growers are amongst one of the most profitable tenants in the market right now. He further clarified that his company aims to maximize profits and lease rates by working with cannabis producers. Mr. Wright also revealed plans to position the company in such a way that it can take full advantage of the growing cannabis industry, to enhance its own shareholder value.
Additionally, the company has also executed an option to purchase agreement, with Wildfire Cannabis. The agreement gives CGRA the right to purchase WFCC for 3-times its annual revenue. The amount can be split up, half to be paid in cash and the other half in stock.
CGrowth Capital Inc (OTCMKTS:CGRA) finished the July 1 session after adding $0.0013 to its share value, to reach a close at $0.0055. The stock traded 10.73 million shares during the session.