Curaleaf Holdings Inc. CURLF, the largest publicly traded cannabis company in the United States by market capitalization, plans to move its stock listing to the Toronto Stock Exchange, the company's chairman told MarketWatch on Thursday.
Boris Jordan said the company has successfully cleared a TSX listing requirement by raising about C$16 million in capital as a final step toward a formal application to the exchange in the near future.
TSX will then review the application, with a potential listing in the near future. The TSX spokeswoman did not immediately respond to an email from MarketWatch regarding the Curaleaf listing.
The TSX listing will bring stability, better governance and better protection from market manipulation, Jordan said.
Curaleaf said Canaccord Genuity has agreed to purchase 2.7 million offered securities from the company for the total gross proceeds of C$16.2 million. In turn, Bank of Canada and the U.S. securities will be offered on a private-placement basis to qualified institutional buyers.
Curaleaf is making the offer to satisfy a condition required for a potential listing on TSX.
On Thursday, Curaleaf's shares rose by 0.9%. The stock is up 4.5% since 2023, compared to a 15% gain by the AdvisorShares Pure US Cannabis ETF MSOS.
The Canadian Securities Exchange maintains stock listings of most other marijuana firms operating in the United States. The stocks are also traded on the OTC market in the U.S., which is more regulated than the New York Stock Exchange and the Nasdaq.
However, NYSE and Nasdaq remain off-limits for cannabis companies doing business in the U.S. due to the Schedule I category for cannabis under U.S. drug law.
Despite its merits for cannabis companies seeking a public listing of some kind, the CSE is a very small exchange compared to the TSX, which ranks among the largest stock exchanges globally. CSE is a venture exchange that does not qualify for many institutions and retirement funds that are typically barred from investing in venture-listed companies. The TSX has no such limitations.
The trading volume of TerrAscend TSND has grown by about three- or fourfold since it moved to TSX in a move that drew attention from analysts over the summer.
Curaleaf, the largest publicly traded cannabis company in the United States, has been operating in states where it's legal. Other big names include Green Thumb Industries GTBIF, Cresco Labs Inc. CRLBF, TCNNF, Trulieve Cannabis Corp. and Verano Holdings Corp. VRNOF.
The move by Curaleaf comes as the U.S. Drug Enforcement Administration reviews the status of marijuana after the U.S. Department of Health and Human Services recommended a Schedule III classification, which would sanction cannabis for medical use.
In March, the department said U.S. Attorney General Merrick Garland had said the department was working on a position statement that would be very close to what was done in the Cole memorandum, a policy put in place in 2013 that limited the role of federal law enforcement regarding cannabis.
Cannabis stocks were up a little earlier this week when the Senate Committee on Banking, Housing and Urban Affairs, known as the SAFER Banking Act, passed a bill that would have made it harder for banks to sell their products.
TerrAscend said Morgan Stanley and BNY Mellon lifted the custody ban on cannabis for Toronto Stock Exchange listing.