Acreage Holdings (CAN:ACRG.U) hit the public markets today.
It raised $314 million in its “IPO” financing round is now the largest marijuana IPO in history.
There’s a compelling opportunity in getting on it early too.
U.S. investors though, have a problem in that they can’t buy shares easily with a few keystrokes like they can Apple (AAPL) or Netflix (NFLX).
That’s because Acreage went public through a Reverse Takeover (sometimes called an RTO or Reverse Merger) and there’s no US symbol to trade the stock of the company Acreage merged with.
A Reverse Takeover involves a tiny shell company “taking over” a much larger company, but with the latter taking over full control.
That’s the case with Acreage Holdings.
Acreage Holdings was technically “taken over” by Applied Inventions Management, but Acreage is still in charge.
Applied Inventions Managements was the shell company. It had no real operations, significant cash, or any intentions of building an underlying business.
What it did have was shares that were listed on the Canadian Securities Exchange.
Acreage Holdings, meanwhile, is one of the largest marijuana companies in the United States with a footprint in California, New York, Florida, and 11 other states.
It raised hundreds of millions of dollars and had $314 million more capital ready to buy into it when it went public.
This is where the reverse takeover comes in.
The two companies – Applied Inventions Management and Acreage Holdings – combined to create one company.
The new name of the combined company is Acreage Holdings.
This means Acreage Holdings is publicly traded now after it was absorbed into Applied Inventions Management.
Here’s where it gets tricky for U.S. investors.
Most of the time there is a U.S. ticker symbol under which U.S. investors can buy into shares into stocks even though they are listed in Canada.
For example, when Curaleaf (CAN/CURA / US:LDVTF) went through the same reverse takeover process, raised more than $300 million, and began trading on the markets.
Curaleaf went through its reverse takeover with a company which already had a US symbol so US investors could easily buy it.
Applied Inventions Management doesn’t have a US symbol, so Acreage Holdings won’t have one right away either.
That leaves two options for US investors who want to buy Acreage Holdings:
US investors can buy Acreage Holdings today on its first day of trading if they want to.
Most major discount brokerages can buy Canadian stocks directly on the Canadian exchanges for US investors even if there is no US symbol.
However, the account holder must call into the firm and go through the process of buying the stock over the phone directly under Acreage's Canadian ticker symbol ACRG.U.
There is no option to buy or sell the stock online-only with most of the major discount brokers.
There is an added cost to this, but it’s usually only $29 or around there for the major discount brokers like Etrade and TD Ameritrade.
US investors must wait for a US symbol to be created for Acreage Holdings.
This process usually takes only a day or with companies as large and with as significant interest as Acreage Holdings is and has.
For example, when The Green Organic Dutchman (CAN:TGOD / US:TGODF) IPO’d in Canada it was the largest marijuana IPO in history at the time.
It didn’t get a US symbol until two days after the IPO.
Acreage Holdings will likely have a US symbol before the week is out.