Author: Jimmy Aki

  • Investment in Recreational Marijuana on the Rise

    Investment in Recreational Marijuana on the Rise

    Drink companies and other investors have begun making moves to profit from the cannabis industry through a series of M&A deals. In Canada, the recent legislation of use of recreational cannabis use has given a boost to the adoption of the industry in North America, as well as the US midterms which saw Attorney General Jeff Sessions (opposed to legalization of cannabis) step down.

    In the United States, medical marijuana is currently legal in 30 states. Only nine states and Washington have legalized recreational marijuana for users above the age of 21 years.

    Canada and America are very important for the growth of the industry as both countries currently contribute 90% of the global revenues. To take advantage of the sector, American companies have enlisted a little-known strategy known as ‘reverse merger’ to grow their operations.

    legal cannabis
    Source: Shutterstock

    Canadian Funds

    Reverse Mergers, also known as Reverse Takeovers (RTO), are a speedy way of becoming a publicly traded company and have been on the increase due to the frenzy around the sector. They are used by private firms who acquire a publicly traded company (or a shell company), thereby becoming publicly traded without going through an Initial Public Offering (IPO).

    For American firms, Canada remains a popular destination for raising capital, for an industry that is still federally illegal in the US. These firms going through this route can skip the troubles they would have faced if they had sought the traditional IPO route.

    These include registration and vetting process from the Canadian Securities Administrators (Canada’s version of the SEC) and investment bankers, who will drill into the finances and barge the company with a ton of questions.

    2018 has witnessed over 200 M&A deals in the cannabis sector, according to data from cannabis-focused analytical firm Virdian Capital Advisors. California based cannabis dispensary provider MedMen, whose high-end dispensaries have been compared to Apple stores, went public in May after purchasing Ladera Ventures—a Vancouver based oil and gas shell company, through an RTO.

    The company also acquired PharmaCann in a $682 million stock transaction, doubling its market share overnight. MedMen’s competitor iAnthus has also been busy making deals, picking up Canadian diversified cannabis firm MPX Bioceutical in a major $640 million deal.

    Entrant of Breweries

    For an industry whose market cap was a little over $5 billion market in 2015, with an estimated projection expected to hit a conservative $20 billion by 2020, the market for the emerging cannabis sector can only get better.

    The industry could witness an explosion when beverage companies make their long-expected entrance and replace part of their alcoholic content with cannabis. Last year, Constellation Brands, the makers of Corona beer, got into the action with a minority stake in Canadian marijuana producer Canopy Growth Corp.

    Winnipeg brewery Fort Garry Brewing Co also joined forces with medical cannabis provider Delta 9 Cannabis to launch the “Legal Lager,” a beer filled with hemp seed.

    According to the company’s press release at the time, the Legal Lager, which was released as “an ongoing research and development project to jointly produce a cannabis beer” that contains Tetrahydrocannabinol (THC), doesn’t contain:

    “cannabis or any other psychoactive agent produced from the cannabis plant.”

    Featured image from Shutterstock.

  • British Billionaire Tej Kohli Floats €50M Fund to Grow Esports in the UK

    British Billionaire Tej Kohli Floats €50M Fund to Grow Esports in the UK

    To boost adoption in the European esports market, a London-based billionaire has floated an investment arm to grow the industry. British billionaire Tej Kohli has allocated €50 million (56 million) to invest in the Esports market in the United Kingdom.

    60-year old Tej Kohli, who runs Kohli Ventures, said his latest move into the esports market was inspired by his son, who spends his time watching the North American leagues and playing Fortnite and League of Legends.

    Based on a news report, the new fund will be called Rewired GG, a subsidiary of Rewired, a venture backed by Kohli with investments in robotics and AI. The billionaire, who made his mark in the real estate and online software development industry, plans to use the funding to develop individual gamers and games in the esports business. In addition, he’s looking at developing his esports team with the investment.

    While Esports has been hugely successful in America and Asia, the market is still largely nascent in Europe. Describing it as a “disruptive innovation” in the world of sports, Kholi went further to enthuse about the sport and how happy he was to drive its growth in Europe.

    When asked about the impact Esports could have in the UK, Kohli stated:

    “I have seen first-hand through my son the passion many young people have for the sport and the growing professionalism of the teams, players and commercial partnerships. I believe that with the right mentoring and investment, Europe will soon play host to the best players, teams and commercial opportunities in global esports.”

    Tej Kohli Will Grow Esports in the UK

    In the UK, investors have been dragging their heels where investments in Esports are concerned. Kohli believes the growing celebrity endorsements and the ever increasing number of young consumers will alert UK investors of the opportunity right under their nose.

    Sam Cooke, Co-founder at Esports Insider, an industry news outlet that currently advises Rewired GG, hailed the investment from Kohli, noting that he was happy investments in the industry had started to:

    “catch up with those already seen in America and across Asia… There is so much European potential in this developing sector, from individual players to whole teams, and the establishment of an investment arm like Rewired GG goes to show that there is now real confidence in this potential.”

    Featured image from Flickr.

  • Fortune Magazine Sold to Bangkok Businessman for $130 Million

    Fortune Magazine Sold to Bangkok Businessman for $130 Million

    US media company Meredith Corporation offloaded Fortune magazine to Bangkok-based businessman Chatchaval Jiaravanon for $150 million in cash, according to an official press release from the company.

    Jiaravanon is an international businessman affiliated with Asian conglomerate Charoen Pokphand Group (CP Group), owned by the Chearavanont/Jiaravanon family, one of the largest producers of livestock. He also serves on the board of communication conglomerate True Corporation, SVI, Finansia Syrus Securities, and a host of other firms.

    The sale of Fortune, which is still subject to approval from regulators, becomes the second sale from Meredith after it sold Time Magazine to Salesforce founder Marc Benioff earlier this year.

    According to the statement from Meredith, Jiaravanon will own the media company as a personal investment under his name not to be affiliated with any of his numerous businesses. Jiaravanon stated in the release:

    “The demand for high-quality business information is growing, and with further committed investment in technology and brilliant journalism, we believe the outlook for further profitable growth is excellent both for the publication and the events business.”

    Meredith, which is backed by billionaire brothers Charles and David Koch, had purchased Time Inc. last year for $1.8 billion to consolidate its stake in the publishing and broadcasting business.

    The Time Inc. acquisition, which also consists of Sports Illustrated, Money, People and Fortune, and others, at the time of purchase, was rumored to give Meredith an extensive reach for paid members and internet-focused millennials.

    Created during the Great Depression in 1929, Fortune was positioned as a media outlet for the influential and wealthy in the society, but like all media companies, dwindling newsstand sales led to the company cutting print production, which led to a reduction in its circulation and sales to its online properties.

    These days, Fortune is notable for its franchise the Fortune 500, its published list of the largest companies in the US and around the world. The media outlet currently reaches 20 million people monthly through its online platform and print publication.

    Featured image from Shutterstock.

  • Facebook Scraps Private Arbitration for Sexual Harassment Claims

    Facebook Scraps Private Arbitration for Sexual Harassment Claims

    Facebook says its employees will finally be able to pursue their sexual harassment complaints in open court, joining the likes of Google, Uber, and Microsoft, who have also scrapped the controversial private arbitration rule.

    In a post titled “Facebook’s Harassment Policy (US Locations),” published on its site, Facebook stated that it was amending the current “arbitration agreements to make arbitration a choice rather than a requirement in sexual harassment claims” adding that “sexual harassment is something” the Social Media giant takes “very seriously.”

    “Facebook may consider an employee’s conduct to be in violation of this Policy even if it falls short of unlawful harassment under applicable law. When determining whether conduct violates this Policy, we consider whether a reasonable person could conclude that the conduct created an intimidating, hostile, degrading, or demeaning environment.”

    Facebook went on to warn employees who violate the policy or decide to harass other employees about the possibility of facing disciplinary action including termination of employment.

    Private arbitration has long been used by tech companies as a tool to prevent a disgruntled employee from suing them in court, but things have started to change in Silicon Valley.

    The sudden change by Facebook comes on the heels of an employee protest at Google, where they complained of how the tech giant had treated cases of sexual harassment, even rewarding executives indicted with large exit packages, including $90 million paid to senior executive Andy Rubin.

    Facebook also updated its policy as regarding office dating between employees. Employees who are directors and above now have to file a disclosure when dating a colleague. Prior to this change, Facebook only required disclosures from supervisors or heads of department dating someone they directly manage.

    Featured image from Shutterstock.

  • Google Concedes to Change Policies After Employee Walkout

    Google Concedes to Change Policies After Employee Walkout

    In what seems to have become a malaise in large corporations, a recent sexual allegation against a senior executive at Google’s parent company Alphabet has burst its seams, per a Fortune report. There were rumbles of discontent among employees at Google following the huge payoffs given to Alphabet’s senior executives who were eased out of the company for sexual harassment.

    This perhaps was not the best time for such controversy to occur at Alphabet. The ill-feeling has been buoyed by the coverup of the harassment case involving Richard DeVaul; an executive whom employees believe should have been dealt with for his actions back in 2015 when the case occurred.

    Employees perceive an air of injustice in the way such matters are being handled and took it upon themselves to stage a protest.

    google
    Source: BBC

    In an effort to pacify the staff, Google Chief Executive Officer Sundar Pichai sent a public message to employees on Thursday saying:

    “Going forward, we will provide more transparency on how we handle concerns. We’ll give better support and care to the people who raise them. And we will double our commitment to be a representative, equitable, and respectful workplace.”

    Google has been able to keep its clout as one of the most influential companies globally. Beyond its overwhelming presence within the business circle, regulatory authorities are now keeping a close tab on the company’s operations.

    The permissive culture in the company’s inner workings is something which many employees are not comfortable with. They think executives have taken the relaxed atmosphere a tad further in their relationship with coworkers.

    Against this backdrop, the protesters demanded more flexibility in the measures available for reporting harassment.

    Employee Walkout at Google Serves to Change Policies

    While the company ceded to some of the changes demanded, Pichai did not address the demand to have an employee as one of the board representatives. The company has nevertheless succumbed to making arbitration in sexual harassment and claims of assault an optional requisite.

    Other commitments which Google has agreed to include the provision of regular, detailed reports about the occurrence of harassment claims and whether they led to the dismissal of staff members involved, and the publication of an internal guide on the investigation processes of harassment cases in the company and others.

    The demands are also expected to cater to thousands of contractors working with Google. The “excessive” consumption of alcohol will also be discouraged by managers especially at work.

    Featured image from Shutterstock.

  • El Chapo Trial Soon to Begin in the US as His Partner’s Wealth Soars

    El Chapo Trial Soon to Begin in the US as His Partner’s Wealth Soars

    The honcho of the world’s largest drug trafficking organization, Joaquin Guzman Loera (El Chapo) has been facing a 17-count indictment and jury selection has finally begun for the trial, while his deputy, Ismael Zambada (popularly known as El Mayo) oversees the cartel’s fortune and remains one of the most wanted fugitives in the world.

    El Mayo who was under the tutelage of Amado Carillo, one of the biggest drug lords in Mexico, rose in ranks and became the logistical coordinator of the Sinaloa Cartel, which emerged from the much older Guadalajara Cartel, formed in the 80s.

    The Sinaloa cartel thrived with the assistance of Zambada who worked as a close associate of El Chapo. Both drug lords lived in stupendous wealth amassed from the proceeds of trafficking drugs to the United States before El Chapo found himself under reins.

    Having escaped from prison on numerous occasions since his first arrest in 1993, security is tighter than ever surrounding the trial.

    His extradition to the United States has left the drug lord who once called the shots of the multi-billion dollar Sinaloa Cartel, in a world of loneliness.

    El Chapo’s court trials have been facing delays after his lawyers argued that they were not sure if their client was mentally competent to face proceedings. Amid tight security at the New York maximum prison, it seems that El Chapo’s mind is now being affected.

    El Chapo’s Misfortune, El Mayo’s Gain

    El Mayo was among the influential figures who made the Sinaloa Cartel the empire it is today. With a massive trade line in the sale and distribution of heroin, cocaine and human trafficking, the cartel has successfully concealed its ill-gotten wealth through undercover bank transfers and offshore accounts.

    The Drug Enforcement Agency traced the cartel’s investment in over 250 companies which run from Latin America to Asia.

    Zambada now occupies the Sinaloa empire as its most experienced hand. As a top commander in the cartel’s hierarchy since 2001, El Mayo had earned at least 5% of the empire’s gross revenue, which places his wealth at an estimated $3 billion according to the Bloomberg Billionaire’s Index.

    Despite his immense fortune, Zambada remains a fugitive. The DEA has a $5 million bounty for anyone who provides information that leads to his arrest.

    As the last founding member of the cartel, El Mayo’s leadership will also be put to the test by other allies in the cartel who plan on usurping power from his grip.

    It remains a puzzle how long he will retain his assumed leadership in the dreaded mountains of Sinaloa, where he continues to hide.

    Featured image from Rolling Stone.

  • Greek Billionaire Alki David to Launch a Cannabis Retail Shop in Scotland

    Greek Billionaire Alki David to Launch a Cannabis Retail Shop in Scotland

    Greek billionaire heir Alki David is one of the world’s most influential men. Having carved a niche for himself in manufacturing, property, and shipping, as well as bottling plants, the Nigerian-born mogul is now planning to start a retail business in cannabis.

    The project began last year when he registered a new business for the sale of oil extracted from cannabis plants. David, who was inspired by the medicinal properties of cannabis, has finalized plans on opening a shop on Edinburgh’s Princes Street before the end of the first quarter of 2019.

    The psychoactive drug (medical marijuana) is being used to treat a wide range of conditions, and this is the selling point the billionaire wants to exploit.

    While airing his views on the immense advantages from the use of cannabis, the entrepreneur underscored its amazing benefits in proffering solutions to a wide range of health conditions. In an interview he said:

    “Plant medicine is revolutionary. It has improved so many lives to the point of miracles happening. It’s helped my mother, and my friend has even been cured of multiple sclerosis (MS) through regular use of strong cannabis oils. There are heaps of arthritis cases too.”

    Alki David Owns Swissx CBD Boutique

    David owns a Swissx CBD (cannabidiol) boutique and Vegan café in Los Angeles and is ready to use it to attain an operational standard for the shop he’s about to set up in Scotland.

    Alexander, his second son, is a student at the University of Edinburgh and this might be one of the motivations behind his choice of Scotland. He said:

    “Scotland is very strategically placed. We have a model that we set up in the US, and that’s what we’re going to start emulating in Edinburgh.”

    Cannabis Is Gaining Momentum

    While legal restrictions in many countries have hindered the use of cannabis, its endorsement by physicians has reduced the restrictions being placed on its usage in other countries.

    In Europe, countries like Germany, Belgium, and the Netherlands allow the use of cannabis based on the recommendation of physicians.

    Some countries like the US also sanction the recommended use of cannabis. Canada went a step further last month by legalizing the recreational use of cannabis. Time will tell if Scotland will follow suit.

    Featured image from ResponseSource.

  • Not Everyone Is Loving the Electronic Scooters Revolution

    Not Everyone Is Loving the Electronic Scooters Revolution

    Manufacturers of electric-scooter sharing companies have been drawn into a legal battle by nine individuals who have at one time or another suffered casualties from using these plug-in electric vehicles.

    The rides can be mesmerizing and adrenaline-filled, however, the slightest blip can catch you off-guard. The consequences are best imagined than experienced.

    A few who have borne the brunt in related accidents felt obliged to file a class-action suit on October 19 in Los Angeles County Superior Court against Birds Ride Inc. and Lime (Neutron Holdings).

    Also included in the list of defendants are electric scooter manufacturers; Xiaomi Corp. and Segway Inc. These companies were accused of gross negligence and complicity in the dangers associated with these scooters before deploying them to the market.

    Following the entrant of Birds into the US market in September 2017, there has been an increase in the demand for e-scooters both for the pleasure and the luxury attached to adding such product to your assets.

    Consequently, the surge has elicited an exponential increase in the number of riders and pedestrians landing in hospitals with injuries ranging from slight infringements to complicated cases–gravel rash, chipped toenails, joint dislocations, fractures, and detached biceps among other gory medical situations reported by both doctors and these victims.

    Three death cases occurred last month in Dallas, Washington DC and Cleveland involving scooter riders. Manufacturing companies have hospitals to thank for saving their blushes in recent times as they tend not to take account of circumstances that led to the causes of a patient’s injury. As a result, there are no definite statistical records on the number of scooter-associated incidents.

    That notwithstanding, Birds and Lime have been keeping close tabs on the number of rides handled by their scooters. This metric reveals over 20 million rides combined, and this increases every day.

    The New Craze

    Electric scooters have registered such an intimidating presence in more than 100 cities across the globe as startups exploit the niche of providing an innovative and eco-friendly type of micro transportation.

    e-scooters

    The ascent within the first year of operation has been a tremendous feat, earning Bird Lime Inc. a unicorn status in Silicon Valley with valuations estimated at nothing less than $3.3 billion.

    The phenomenal rise in the craze for scooters has, however, been trailed by controversies, complaints, and breaches. Fears have been cited about the risks they portend to public safety, and this has even led to authorities in some cities wielding regulatory provisions just to put a gag in its usage.

    San Francisco and Santa Monica imposed a temporary ban on electric scooters. They went further, filing criminal suits against their manufacturers who are allegedly operating without a business permit.

    At the communal level, some disenchanted vigilante residents have gone to the extreme by dumping scooters in the ocean. Some settled for burying them in the ground while there are those who resorted to setting them ablaze.

    The plaintiffs had different narratives to tell according to the lawsuit which was filed. Two among them got injured by tripping over electric scooters, abandoned on the sidewalk.

    Four got knocked over from behind as they walked. Included among the casualties was a 7-year-old boy who suffered severe damage in his dentition and lost eight of his front teeth in the process. The gravity of the incidence affected his lips severely.

    The personal injury lawyer at McGee Lerer who is the counsel of the plaintiffs stated criticized these companies for being preoccupied with their profit at the expense of general safety.

    There has been a sense of awakening among those who have never been able to voice their say since the lawsuit was filed. An additional 75 persons according to Lerer have been casualties of scooter-related accidents including a 67-year old man who suffered brain damages.

    In response to these spates of accusations, Bird and Lime maintain safety as one of their priorities. In their viewpoint, cars pose a lot more danger. A spokesperson of Bird stated in a written statement:

    “Class action attorneys with a real interest in improving transportation safety should be focused on reducing the 40,000 deaths caused by cars every year in the U.S.”

    Images from Shutterstock.

  • US Limits Exports to Chinese Semiconductors Firm Fujian Jinhua

    US Limits Exports to Chinese Semiconductors Firm Fujian Jinhua

    In a move that could escalate its trade war with China, the US has put in plans to restrict exports to a state-backed Chinese company Fujian Jinhua that makes semiconductors. The move could add further strain to a bilateral relationship which has seen a standoff between both countries on trade and market access.

    In a statement released by the US Commerce Department, the agency said that the Fujian Jinhua Integrated Circuit Company will require a special license before it can procure components from American manufacturers.

    The statement from the agency reads in part:

    “The Department of Commerce has taken action to restrict exports to Fujian Jinhua Integrated Circuit Company, Ltd. [Jinhua] by adding them to the Entity List [Supplement No. 4 to Part 744 of the Export Administration Regulations (EAR)], because Jinhua poses a significant risk of becoming involved in activities that are contrary to the national security interests of the United States.”

    Speaking on the ban, Commerce Secretary Wilbur Ross stated:

    “When a foreign company engages in activity contrary to our national security interests, we will take strong action to protect our national security.”

    According to Ross, the ban on Fujian Jinhua will limit the firm’s ability to threaten the supply chain for components used in America’s military systems.

    Fujian Jinhua Is a Security Risk

    The agency went on further to state that Fujian Jinhua poses a security risk as it could flood the market with cheaper semiconductors made by American companies that supply the US military.

    If this happens, American manufacturers for that component might go out of business and it could lead to the military sourcing components from abroad for items that should be procured within the country.

    This move by the Commerce Department comes on the heels of a federal lawsuit filed by Idaho based Micron Technology, against Fujian Jinhua, accusing the Beijing-based company of stealing its trade secrets last December.

    Fujian Jinhua fired back with its own countersuit in a Chinese court in January. The US government had also put a ban on Chinese smartphone manufacturer ZTE, accusing the tech company of deceiving American officials, by claiming to have punished employees who flouted US sanctions against Iran and North Korea. The ban was finally lifted after ZTE agreed to put in more oversight measures and pay a $1-billion fine.

    Fujian Jinhua is an advanced chip manufacturing enterprise that has state backing from the provincial government where it’s located. According to state media, the chip manufacturing company is currently building a $5.7 billion chip factory in the province.

    Featured image from Shutterstock. 

  • Basketball Legend Michael Jordan Buys into Esports Franchise

    Basketball Legend Michael Jordan Buys into Esports Franchise

    NBA icon Michael Jordan is delving into eSports, as he invests in aXiomatic, Team Liquid’s parent company. His foray into the emerging eSports industry should bring more clout into professional gaming which currently generates over US$325 million worth of revenue.

    The six-time NBA champion regarded as the greatest basketball player of all time is the principal owner and chairman of the league’s Charlotte Hornets.

    The entertainment and sports management company aXiomatic on Thursday announced the entrant of Michael Jordan and Declaration Capital; the family office of the Executive Chairman of The Carlyle Group, David Rubenstein.

    The entrant of these two big players helped aXiomatic in raising $26 million in a Series C funding round according to Forbes.

    Michaell Jordan remarked:

    “I’m excited to expand my sports equity portfolio through my investment in aXiomatic, eSports is a fast growing, international industry and I’m glad to partner with this great group of investors.”

    Team Liquid sold a chunk of its controlling interest to investors under the ownership group aXiomatic in 2016. Profound among these investors is the NBA Hall of Famer and co-owner of the Dodgers, Magic Johnson.

    Other hoops stars who have staked investment in esports franchises include Rick Fox, Shaquille O’Neal, and Jonas Jerebko.

    An enthusiastic Leonsis told ESPN in a statement:

    “The next generation of sports fans are esports fans… Esports is the fastest-growing sector in sports and entertainment, and aXiomatic is at the forefront of the growth.”

    Victor “Nazgul” Goossens founded the multi-regional professional esports enterprise, Team Liquid, in 2000 in Utrecht, the Netherlands. It premiered the multi-genre management in 2012 after it recruited a North American Dota2 team.

    Its merger with Team Curse in 2015 under the helm of Liquid banner further reinforced its staff strength with the likes of Steve Arhancet, former Curse League of Legends, Street Fighter and Super Smash Bros teams.

    The team currently thrives in a number of divisions including Clash Royale, Fortnite, Brawl Stars, Dota 2, and PUBG to mention a few.

    Featured image from Sportsnet.ca.