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Buds are removed from a container at the "Oregon's Finest" medical marijuana dispensary in Portland, Oregonin this April 8, 2014 file photo.

Steve Dipaola/Reuters

In late 2013, when Bruce Linton, CEO of Tweed Marijuana Inc. needed to raise money, he wasn't going to waste his time calling one of the big banks. They weren't lending to anyone in the sector, he says – and not much has changed in the interim.

"The banks do not lend any credit [to medical marijuana companies]. There is no debt facility for us." said Mr. Linton in a telephone interview.

Even though his company can now legally grow and sell medical marijuana on a commercial basis (the practice was legalized in April 2014 for licensed providers) the big banks aren't interested, because they are "playing politics" and concerned about "reputational risk," he opines. So he knew back then his only option was to strike up a relationship with an independent broker.

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"I'd looked at a couple of other firms and settled on GMP Securities LP as the best choice [to lead the syndicate of equity underwriters] because of the approach that they took, which was 'let us understand it.'"

"It" is the medical marijuana industry. Since November 2013, GMP has led three private placements for Tweed, brought the company public in a reverse takeover transaction in April 2014, and has led two bought deal financings – the most recent of which closed Tuesday with Tweed taking in $20-million.

Tweed isn't the only marijuana company GMP has done business with. In the summer of 2014 GMP was part of a syndicate that raised $34-million in a private placement deal for Mettrum Health Corp., another licensed producer of medical marijuana that went public in October 2014.

While these deals are small in scale for GMP, they are much needed wins in a rough resource market – traditionally, one of the firm's strengths. GMP's investment banking revenue fell 36 percent in the fourth quarter, largely thanks to a drought in the energy sector, which only brought in $2.6-million, versus $22-million in the third quarter.

Weed won't solve all of GMP's ills. There are a mere 16 licensed producers in Canada's nascent medical marijuana industry. Tweed, the first company in the sector to go public, is still a toddler, taking in revenue of only $640,000 in its most recent quarter.

But at least GMP is getting in on the action early this time. CEO Harris Fricker recently admitted the company missed an opportunity in the online gambling industry, which has become a lucrative source of investment banking revenue for some of its competitors. Canaccord Genuity Corp. has cornered that sector, and was the lead Canadian investment banker on Amaya Inc's $4.9-billion (U.S.) acquisition of Rational Group, the owner of prominent online gambling site PokerStars, last year.

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