Emerald Buys MJ Biz For $120 Million

Emerald Holding, Inc. (NYSE:EEX) has purchased MJBiz in a deal valued at $120 million. In 2021, MJBiz’s revenues were approximately $27 million, which were near pre-pandemic levels. MJBiz EBITDA for the calendar year 2021 is $13,700,000. MJBizCon is a top trade show in the cannabis industry having featured more than 1,200 exhibiting companies. While the company boasted of over 18,000 paid registrations, at the October 2021 event, it was a big drop from the company’s last pre-pandemic event. Emerald said in a statement that the MJBiz platform delivered 38% compound annual revenue growth in the three years prior to the pandemic (2017-2019).

MJBiz management, including CEO Chris Walsh, Senior Vice President of Events and Sales, Jess Tyler, and Senior Vice President of Content and Audience Development, Pam Moore, will continue to lead the day-to-day operations of the business. MJBiz co-founders and Board members, Cassandra Farrington and Anne Holland will continue to consult with the business.

Hervé Sedky, Emerald’s President and CEO, said, “This is a transformational acquisition for Emerald as it represents an important next step in the implementation of our strategic initiatives and underscores our commitment to evolve and grow our customers’ businesses 365 days a year. We have long admired MJBiz’s sterling reputation for being the most trusted event and content producer serving the business side of the cannabis and hemp industries and their respective participants. MJBiz’s leading event and content portfolio coupled with their 365-day engagement platform, which connects the entire cannabis supply chain, will diversify our collective product offerings, enhance our growth profile and enable us to deliver even greater value to our customers over the long term.”

Emerald’s Finances

Emerald is a trade show company that hosts events like Surf Expo, the Outdoor Retailer Snow Show, Pizza Expo, and The International Contemporary Furniture Fair. The company reported $76 million in its most recent quarter ending in September. It also reported net losses of $18 million or ($0.25) cents per share. The company hosted 32 in-person events in the third quarter of 2021. It completed the sale of a 7% Series A Convertible Participating Preferred Stock, generating net proceeds of $382.7 million in the third quarter. The company’s past event insurance covered Covid, but Emerald also stated that future insurance policies in 2022 will not cover Covid-related event cancellations. As of September 30, 2021, the company had $521.0 million of borrowings outstanding under the Amended and Restated Term Loan Facility.

Trade show revenues represented approximately 74% and 59% of total revenues for the three and nine months ended September 30, 2021, respectively. Trade show revenues represented approximately zero and 68% of total revenues for the three and nine months ended September 30, 2020, respectively.

 

 

Debra Borchardt

Debra Borchardt is the Co-Founder, and Executive Editor of GMR. She has covered the cannabis industry for several years at Forbes, Seeking Alpha and TheStreet. Prior to becoming a financial journalist, Debra was a Vice President at Bear Stearns where she held a Series 7 and Registered Investment Advisor license. Debra has a Master's degree in Business Journalism from New York University.


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