Alliance One International Inc (NYSE:AOI) stock rallied on Tuesday after its wholly-owned indirect subsidiary, FIGR Inc, received permission from Health Canada allowing the sale of medicinal cannabis oils.
The permit was granted to a subsidiary of FIGR, Canada's Island Garden (CIG), which was given a sales license authorizing it to sell medicinal cannabis oil products. The company had received a sales license for dried cannabis flower on February 7, 2017.
"As the only licensed producer in Prince Edward Island, we can now participate in the derivative cannabis market by further expanding our product line for patients and offering an alternative to inhaled products," said CIG president Edwin Jewell.
Shares of Alliance One surged nearly 40% to US$24.40, having touched a session peak of US$25.40.
CIG previously announced a supply agreement with the province of Prince Edward Island for 1,000 kilograms/kilogram equivalent of cannabis products, which will now include cannabis oils.
Cannabis oils are extracts that are derived from the cannabis plant. Cannabidiol, or CBD, is used to treat epileptic seizures among others.
FIGR is a holding company that owns majority stakes in two Canadian cannabis producers, Canada's Island Garden, a licensed producer in Charlottetown, Prince Edward Island, and Goldleaf Pharm, a late-stage licensed producer applicant in Simcoe, Ontario.
AOI, on the other hand, is an agricultural company that provides sustainable and traceable products and ingredients. The company is based in Morrisville, North Carolina.