Hydroponic cultivation systems and accessories are benefiting from marijuana adoption
Hydroponic grow facilities have been around for decades. They have been almost always associated with the illegal business of marijuana cultivation, but manufacturers of the equipment are now getting the last laugh. The explosive growth of marijuana around the world is resulting in a boom for hydroponic equipment manufacturers.
Marijuana grown in hydroponic facilities grow at a rate 50% faster than in soil. They are said to produce better results because they offer nutrient-rich bases that allow the cultivation to occur in a completely controlled environment. Additionally, they allow for marijuana cultivation anywhere at any time, without having to be concerned about climate conditions.
One of the hydroponic companies benefiting from the boom is Sugarmade, which just signed an acquisition deal with Sky Unlimited, a company that offers hydroponic equipment and accessories through its Athena United brand. Sugarmade indicated that, because of the deal, it would increase its revenue forecast for 2019 from $30 to $70 million.
Sugarmade CEO Jimmy Chan explained, “We are seeing a clear trend in our particular sector of the cultivation supply business. Many of the smaller growers are being replaced by very large grow operations that are purchasing large amounts of products from a limited set of suppliers. Matching this trend is Sky Unlimited as commercial accounts are now over 50% of operations and still growing. Thus, we believe we are especially well positioned via this business combination. Sky Unlimited also sees strong benefits for its existing and future customers as the increased capitalization and lowered cost of capital will allow it to further expand its brands and to accelerate the development of new products and technologies.”