Company Reaches Financing Agreement for $2.5 million, Enabling the Company to Bring Proprietary Hemp Clones to Market Through EZ-CLONE
GrowLife to leverage subsidiary EZ-CLONE expertise by adding CBD-rich hemp clones to product offering, eyeing large market opportunity driven by lack-of-supply of hemp clones
Company reaches definitive agreement for equity financing of $2.5 million
Financing to enable company to pay-down outstanding debt, further invest in manufacturing core business unit, and introduce new products including hemp clones
KIRKLAND, Wash. — GrowLife, Inc. (OTC: PHOT), one of the nation’s leading plant cultivation and cannabis/hemp cloning solution providers, announced today the company has entered into a definitive equity financing agreement of $2.5 million, enabling the company to add CBD-rich hemp clones sales to its current service offering by next year.
“With the federal legalization of hemp and nationwide demand for CBD increasing, the need for high yield, CBD-rich hemp has never been greater and we have an unprecedented opportunity to supply these farmers with the clones they need to start their plants through EZ-CLONE,” said Marco Hegyi, GrowLife CEO and President. “We are working with the best hemp geneticists and large-scale propagation partners to deliver the highest-quality CBD-rich hemp clones to farmers on a nationwide scale in 2020. In order to do this, we needed solid financing with minimal dilution. This new funding illustrates the confidence our investor has in our strategy by putting in $2.5 million at market price.”
Hegyi added “the demand for CBD-rich hemp has grown 368% in just one year and an estimated 200,000 acres will be planted this year, up from roughly 25,000 just two years ago. Through our propagation experience with EZ-CLONE, we are creating an understated value to hemp farmers nationwide who do not have the time or experience to grow clones internally. These clones have high margins and create a significant revenue generation opportunity for us, on which we plan to capitalize as quickly as possible. We plan to make further announcements on progress of this new initiative in the coming weeks.”
Hemp-derived CBD products are one of the fastest growing consumer segments in the world, with researchers estimating the market for CBD in the U.S. alone could be worth almost $24 billion by 2023. The shift in consumer sentiment for these products has created a large demand for the raw materials needed in order to produce these products. Since the passage of the Farm Bill which legalized hemp production in the US, farmers have been scrambling to plant hemp in order to meet this new demand.
The funding will enable Growlife to make three important advancements in the organization. First, retire some of the diluting debt that is weighing down the balance sheet. With the improved terms, the company will allocate some of the funds towards paying off more expensive debt. Second is to expand the current base business which has proven rapid growth through the integration of EZ-CLONE and its high margin manufacturing business. This unit needs further investment into sales and marketing as it continues to capture market share. Finally, this funding will be used to execute on the market opportunity of hemp cloning by enabling the company to introduce new high margin CBD-hemp clones to GrowLife’s extensive network of plant cultivators across the nation.
The financing is subject to final approval from the SEC.
All stock recommendations and comments are the opinion of writer.
Investors should be cautious about any and all stock recommendations and should consider the source of any advice on stock selection. Various factors, including personal ownership, may influence or factor into a stock analysis or opinion.
All investors are advised to conduct their own independent research into individual stocks before making a purchase decision. In addition, investors are advised that past stock performance is not indicative of future price action.
You should be aware of the risks involved in stock investing, and you use the material contained herein at your own risk. Neither Market-Advisor.com nor any of its suppliers guarantee its accuracy or validity, nor are they responsible for any errors or omissions which may have occurred. The analysis, ratings, and/or recommendations made by Market-Advisor.com, and/or any of its suppliers do not provide, imply, or otherwise constitute a guarantee of performance.
Market-Advisor.com is comprised of reports, if any, embodying a unique system of stock analysis. Accuracy and completeness cannot be guaranteed. Users should be aware of the risks involved in stock investments. It should not be assumed that future results will be profitable or will equal past performance, real, indicated or implied.
The material on this website are provided for information purpose only. Market-Advisor.com does not accept liability for your use of the website. The website is provided on an “as is” and “as available” basis, without any representations, warranties or conditions of any kind.