Sunniva Inc. (OTCMKTS:SNNVF) is solidifying its growth strategy in anticipation for exponential growth this year. Notably, the firm acquired a new round of funding worth CAD 10 million via a non-brokered offering of convertible debentures. Interestingly, the need for the capital arose after an unusually high demand for proprietary products.
Near-term future sales contracts on the rise
In particular, the increased demand raised the need for more working capital as well as short-term financing. Notably, the firm has a lot of purchase orders on its hands worth approximately $7.6 million. Interestingly, all of these purchase orders come from dispensaries within California. The firm announced over $2.4 million purchase contracts in January which were all near-term future sales. With the additional $5 million short-term future sales contracts secured, it is clear that demand is building up.
According to Sunniva, the market has a keen interest in proprietary ultra-distillate products. Notably, these come in vape cartridges as well as disposable pens and live resin vape cartridges. Further, there is high demand for premium concentrates that come in all forms plus premium flower. All these are Sunniva branded product lines that demand more space for production to beat deadlines.
Sunniva bolstering strategic advantage
In this respect, Sunniva took various strategic steps to make sure there is no chance for the breakdown in this high season. Notably, the firm developed a large-scale production greenhouse in Cathedral City, California. As per the company, the new funding round is instrumental in ensuring that the facility is up and running in good time.
Specifically, the money will go toward acquisition of clean biomass used in the extraction facility. Additionally, the funding will facilitate the obtaining of clean flower supplies through the establishment of strategic partnerships.
Further, Sunniva acquired TYR Logistics, LLC late last year to spearhead the distribution of the Sunniva branded products. Notably, the subsidiary would enable Sunniva to bolster its growth strategy for the year 2019.
Commenting on the acquisition last year, Dr. Anthony Holler, CEO of Sunniva, said, “We are pleased to have completed this transaction, and we are looking forward to 2019 when the full impact of adding compliant distribution to our portfolio will be realized.”