Glass House Brands Inc. (NEO: GLAS.A.U ) has called off its previously announced conditional agreement to accept a $50 million strategic investment from The Parent Company, whose official name is TPCO Holding Corp (OTC: GRAMF). Glass House said that it was a mutual agreement and that the Strategic Investment will not be completed at this time. Glass House said in its statement that it will consider future partnership opportunities with The Parent Company after the purchase and retrofit of the 5.5 m square foot greenhouse cultivation facility located in Ventura County, California.
TPCO Holding Corp. confirmed that the private placement offering by Mercer Park Brand Acquisition Corp. has been terminated by the parties effective today Mercer Park Brand Acquisition Corp. recently merged with Glass House.
“In addition to our supply of award-winning, in-house cannabis, we remain well-positioned with sufficient access to both high-quality, low-cost indoor and outdoor-grown cannabis for use in our portfolio of branded products that are sold through our wholesale and direct-to-consumer channels,” said Steve Allan, Chief Executive Officer of The Parent Company. “Glass House is building a robust cultivation footprint in California, and we look forward to working with their team in the future on potential collaborations as we broaden our reach across the State. Looking ahead, we will continue to strategically deploy our capital on high-growth investment opportunities that will solidify our leadership position and offer strong value for our shareholders.”
Glass House also said that it didn’t expect the termination of the investment to affect the current purchase and development plans for the Camarillo Greenhouse Facility, its acquisition of seventeen retail licenses, or the pre-transfer construction currently occurring concerning four of those retail locations, or its ongoing land use permitting concerning recently won licenses in Isla Vista and Santa Ynez, California.
Glass House said it expects to complete the purchase of the Camarillo Greenhouse facility this quarter and is currently negotiating with several banks and other lenders for property secured financing, the majority of which is expected to be used for the retrofit.
On Monday, July 5, Glass House is set to begin trading on the NEO exchange in Canada under the name GH Group, Inc. or Glass House Brands. The subordinate, restricted, and limited voting shares and warrants of Glass House were approved for listing on the NEO Exchange under the symbols “GLAS.A.U” and “GLAS.WT.U”.
In 2020, Glass House reported that it grew revenue 185% year-over-year to $53 million and generated positive adjusted EBITDA, driven by its expanded cultivation and distribution footprint, improved supply chain and production efficiencies, and enhanced consumer brand profile. Including the assets of the Southern California Greenhouses and proposed Element 7 retail licenses, the combined company expects to generate full-year 2022 revenue and adjusted EBITDA of approximately $326 million and $104 million, respectively.