US banks continue moving towards deal making in the cannabis sector, with Bank of America (NYSE:BAC) now holding just over US$2 million worth of stock in a large Canadian marijuana firm.
The bank reported that it held 382,352 shares of Aphria (NYSE:APHA,TSX:APHA) as of its latest disclosure with the US Securities and Exchange Commission, as per a Finance Daily report on Saturday (May 4).
Bank of America has taken decisive steps forward in the marijuana industry as it recently launched its coverage of the space.
In April, the banking firm issued its first analyst report on the Canadian cannabis space.
While the bank shows its willingness to hop on board the legal cannabis industry, the report raises some questions on the future state of the Canadian market.
“There are over 50 publicly traded Canadian cannabis licensed producers, far too many for a cannabis market the size of Canada’s, in our view,” analyst Chris Carey indicated in the report.
This move represents another sign of the US bank expanding its presence in the cannabis sector.
Bank of America’s subsidiary BofA Merrill Lynch is acting as an underwriter for CannTrust Holdings (NYSE:CTST,TSX:TRST). Last Thursday (May 2), the Canadian cannabis firm priced an offering at US$5.50 per share