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Sugarmade Inc (OTCMKTS:SGMD) Places Temporary Hold On Reverse Split Of Shares: Sugarmade Plans To Establish Presence In The Regulated Cannabis Market



Sugarmade Inc (OTCMKTS:SGMD) placed a temporary hold on a reverse split of its shares. The company is awaiting the nod of its directors for a reverse split. Sugarmade is planning to establish its footprint in the licensed and regulated cannabis market with a focus on the retail sector and distribution in California.

Significant opportunities in cannabis space in CA

Chief Executive Officer of Sugarmade, Jimmy Chan, said he doesn’t see any reason to go ahead with the reverse split of common shares. The company will reactivate the reverse split if necessary at an appropriate time. It is now aligning its business strategy with the cannabis market place. Sugarmade is in advanced discussions to make a strategic move into the cannabis space where it finds significant opportunities in cannabis distribution in California.

Crackdown on illegal market participants in CA

The recent crackdown on illegal market participants in CA is showing significant progress. Now, the prospects for licensed and legal cultivators, retailers, distributors, and processors appear bright. The cannabis industry is progressing at a fast pace. Sugarmade expects significant opportunities in the Californian cannabis industry.

Scraps a deal to take over hydroponic equipment supplier

Sugarmade has scrapped the deal to take over hydroponic equipment supplier because its directors felt that business combination will not improve shareholder value. Accordingly, its treasury will receive back 1.2 billion common share equivalents. The company expects to achieve monthly savings of $1 million in the next seven months. Sugarmade is now considering various business combination strategies that are viable and offer rich dividends.

The board of directors of Sugarmade is of the view that regulated cannabis space that comprises legal THC cannabis and hemp cultivation, marketing, and processing is appealing and offers scope for enhanced revenues. Therefore, Sugarmade considers entering the legal cannabis market, where significant opportunities for acquisitions exist.

The demand for laboratory equipment and hemp extraction equipment will increase considerably going forward. Sugarmade began the supply of such equipment for installation in the eastern region of the US in one of the significant planned facilities. Chan said the company is pleased to announce that the accepted components from manufacturers are in route to the facilities for installation.  The company will recognize these revenues in January 2020.

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