California-based Sugarmade, Inc. (OTCQB:SGMD) was active Wednesday. The firm, one of the largest publicly traded hydroponics supply companies, signed a binding Letter of Intent to acquire Sky Unlimited, LLC a California-based supplier of cannabis cultivation materials to wholesalers and large commercial cannabis cultivators.
Sugarmade reckons the deal will boost earnings and shareholder value, and so revising its guidance for full-year 2019 revenues to more than $70 million.
Sugarmade's revenue within the cannabis cultivation supply sector comes mainly from online sales, while Sky's revenues are mainly generated via direct sales to wholesalers and large commercial cultivation companies.
Sugarmade CEO Jimmy Chan was quoted thus: "The trend in cannabis cultivation is toward the larger commercial cultivation operations, and Sky Unlimited is in the thick of that dynamic marketplace.”
Shares in SGMD moved, well, skyward, 2.245 cents, or 19.1%, to 14 cents, late in Wednesday’s trading session, on a volume of eight million shares.
