Ottawa-based cannabis investment firm CannaRoyalty Corp. (CSE:CRZ) says it's acquiring a 20 per cent stake in Anandia Laboratories Inc., a company that specializes in marijuana testing, in a deal valued at $4 million.
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There are currently seven licensed cannabis producers in Canada who are working with the Vancouver-based cannabis biotechnology company to test their products.
A report released last month by the federally appointed task force on marijuana highlighted the importance of testing cannabis products to ensure they're safe for consumption.
In addition to testing, Anandia Labs also develops cannabis strains for medical use.
The deal, which will be funded through a combination of cash, equipment and services and common shares, is expected to close by Jan. 31, subject to approvals.
CannaRoyalty, or Cannabis Royalties, finances and invests in marijuana companies in Canada and in American states that have legalized the substance.
CEO Mark Lustig told OBJ last month that many cannabis entrepreneurs in North America have great ideas, but are inexperienced in raising capital.
He also sees banks avoiding the risks of the industry, unwilling to dive into the market until theyâ€™re sure the majority of investment conditions and risk calculations fall in their favour.
This has created an opening for CannaRoyalty, which is is financing and acquiring equity in promising companies in return for ownership, royalties or licensing agreements.