MedMen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) updated shareholders on its progress in the company’s restructuring efforts after the market closed on Friday. MedMen said it hired ATB Capital Markets Inc. to help the company review and sell one or more of its non-core assets in Arizona, Illinois, and Nevada. ATB will help MedMen determine which assets to sell to boost liquidity and maximize shareholder value with an asset-light model.
The company said in a statement that it was considering selling the following assets:
- Arizona: vertically integrated operations comprising one dispensary located in Scottsdale and a 20,000 sq. ft. cultivation and production facility located in Mesa
- Illinois: two dispensaries located in Oak Park and Morton Grove
- Nevada: two dispensaries located in Las Vegas
The company has been trying to sell its New York assets, which Ascend Wellness opted not to buy in 2022 triggering a short but intense legal battle. If it is able to divest all the properties it seeks to sell, then MedMen would be left with only its California stores and its Massachusetts Fenway Park store. The company lists 13 locations in California.
The company went on to say that it has managed to cut expenses in payroll costs across its retail locations, cultivation centers, and corporate headquarters by 34%. MedMen said in its statement, “Along with right-sizing the expense structure, the company continues to make progress on localization of store assortments and improving the product quality and profitability of its cultivation centers. Implementation later this spring of a new POS system and loyalty platform will drive increased store efficiencies as well as significantly more meaningful customer engagement.”
MedMen quietly released its earnings without a press release in early February. That filing noted that the company needed more cash than was coming in and that it needed to raise capital. However, at the same time, the company also told shareholders that it had defaulted on its debt. At that time Green Market Report wrote, MedMen said it would delay new store openings, permanently or temporarily close underperforming stores, and other restructuring activities. The company said it was also trying to renegotiate leases with landlords and outlined several lawsuits regarding the company’s real estate issues.