08:51:53 EDT Fri 29 Mar 2024
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Shell Summary for Sept. 22, 2014

2014-09-22 19:54 ET - Market Summary

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by Stockwatch Business Reporter

The TSX Venture Exchange fell 26.97 points to 928.09 Monday, an eight-month low for the junior exchange, which has fallen nearly 100 points since the start of September. Today's tumble was also the largest decline in one day since April 17, 2013, when the TSX-V fell 36.4 points (and two days prior to that it fell 64.36 points). One bright light in this otherwise dark junior market has been the listing of licensed medical marijuana companies, many of which are making their way to the TSX-V through the use of capital pool shells. Today, for example, we will discuss Don Wright and John O'Sullivan's capital pool shell, Cinaport Acquisition Corp. (CPQ), which expects to complete its acquisition of Mettrum Ltd. next week.

Cinaport will roll back its shares 1:14.5625, leaving it with 418,197 postconsolidated shares, and then issue 33,256,880 postconsolidated shares to the shareholders of Mettrum. The shell will also change its name to Mettrum Health Corp. and trade under the ticker symbol MT. The target has one of the coveted licences to produce medical marijuana under Health Canada's new MMPR program, which became effective Oct. 1, 2013. Health Canada issues production licences for companies that then sell marijuana to patients who have a doctor's prescription. So far, Health Canada has issued 13 licences and received more than 900 applications. Under the old MMAR program, thousands of individuals had personal licences to grow their own supply of medical marijuana at home, but the government determined that the numbers were getting out of hand and introduced the MMPR program as an easier way to regulate the destination of the drug. The government intended to phase out the old MMAR program by March 31, 2014, but on March 21 the Federal Court of British Columbia granted a limited injunction permitting anyone, who held a valid authorization to possess and a personal-use production licence to continue to grow and possess medical marijuana past the expiration date of March 31. The government has appealed the court's order, with an appeal date now set for Feb. 23, 2015. Should the court decide to take away all MMAR-related licences, there will be plenty of patients in search of a medical marijuana producer such as Mettrum.

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