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An investment vehicle devoted to the budding legal cannabis sector is seeking to go public in Canada on the Aequitas Neo Exchange Inc.

Cannabis Strategies Acquisition Corp. is a special-purpose acquisition company, or SPAC. A SPAC is a company that raises money in the public markets in order to acquire other businesses within a certain period of time. It won't have commercial operations or assets other than cash until such a deal is done.

The SPAC is looking to raise $125-million to buy one or more private marijuana companies that are valued between $150-million and $300-million, according to regulatory filings made public late Monday.

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The company is open to investing in cannabis producers or distributors in several countries, including in Canada and in the United States, where the drug is legal in certain states but illegal under federal law.

Last month, the Toronto Stock Exchange said that any issuer that is operating in violation of federal drug laws in the U.S. is breaching its listings policies. For this reason, Cannabis Strategies Acquisition is listing its shares on the Neo, which has no problem listing these stocks.

The Neo is a relatively new and little-known Canadian stock exchange backed by a group of financial institutions, including Royal Bank of Canada. To date, its listings include a small roster of exchange-traded funds.

The SPAC is being taken public by Mercer Park L.P., which is a private investment firm in New York controlled by Jonathan Sandelman. The company will rely heavily on the expertise of its chief operating officer, Mark Smith, a marijuana operator in Colorado and Nevada.

Cannabis Strategies Acquisition has to do a deal within 18 months, or return its capital to investors. Under the rules of the SPAC, shareholders get to vote for or against any planned transaction.

Even as restrictions on the drug are eased in several countries, the hazy legal landscape has made it difficult for marijuana companies to get access to capital to fund their business.

Canaccord Genuity Corp. is the sole underwriter on the offering.

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