There are 55 companies preparing to go public on the Canadian Securities Exchange, a market for upstart companies that has become a popular listing venue for U.S. cannabis companies.
The companies, which have publicly disclosed their intentions to list on the CSE, are all in various stages of the process, said Richard Carleton, the exchange’s chief executive.
The anticipated listings come at a time when rising interest rates, political turmoil and fears of slowing global economic growth have led to stock market volatility. Market turbulence can often cause companies to put their go-public plans on ice.
A new report issued by the exchange says U.S. companies, particularly those in the burgeoning cannabis industry, have overtaken Canadian issuers as the leading fundraisers on the CSE. U.S. companies attracted $2.73-billion of investment last year. That’s more than half – 52 per cent – of the investment generated on the exchange in 2018.
And Mr. Carleton says the trend is likely to continue.
“We expect 2019 will be a year where the Canadian capital markets continue to provide substantial capital to the U.S. cannabis industry,” Mr. Carleton said in an interview Monday.
Just the number of cannabis listings understates their importance to the CSE, however. According to S&P Global Intelligence, there were 32 CSE companies with a market capitalization of at least $100-million as of Friday; 31 of those, including the 17 biggest, were in the cannabis business.
In total, 123 companies went public on the CSE last year, a record for the stock exchange. Of those companies, 55 were in the cannabis sector, 37 were in mining and 24 were in technology.
The largest deal was a $520-million issue by Curaleaf Holdings, followed by a $416-million issue by Acreage Holdings and a $288-million deal by Harvest Health & Recreation. All eight of the largest deals were by U.S.-based cannabis companies, according to the report.
In total, U.S. cannabis companies raised $2.65-billion on the CSE last year, accounting for 51 per cent of total fundraising on the exchange.
With a file from David Milstead
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