IPO Archives - Green Market Report

StaffStaffMarch 1, 2021
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4min410

Optimi Health Corp. (CSE: OPTI) announced the closing of its oversubscribed initial public offering on February 24, 2021. Pursuant to the Offering, the Company issued 27,600,000 units of the Company at a price of $0.75 per Unit for aggregate gross proceeds to the Company of $20,700,000, which includes the full exercise of the over-allotment option.

The common shares of the Company and the common share purchase warrants issued began trading on February 25, 2021 on the Canadian Securities Exchange. The Offering was led by Mackie Research Capital Corporation, as the lead agent and sole bookrunner, on behalf of a syndicate of agents, including Canaccord Genuity Corp. and Stifel Nicolaus Canada Inc.

The Units offered under the Offering each consist of one Common Share and one‐half of one common share purchase warrant of Optimi. Each Warrant is exercisable to acquire one common share of the Company at an exercise price of $1.25 per Warrant Share at any time until February 24, 2023.

The net proceeds of the Offering will be used for capital expenditures related to the Company’s facilities in Princeton, BC, the development of the company’s functional mushroom business, the execution of the Company’s Psilocybin and Psilocin research and development initiatives, and for working capital requirements and other general corporate purposes.

No securities regulatory authority has either approved or disapproved of the contents of this news release. The Units, the Unit Shares and the Warrants comprising the Units, and the Warrant Shares issuable upon exercise of the Warrants, have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act“), or any state securities laws. Accordingly, the Units may not be offered or sold within the United States or to U.S. persons (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws, or pursuant to exemptions from the registration requirements of the U.S. Securities Act and applicable state securities laws. This news release does not constitute an offer to sell or a solicitation of an offer to buy any securities of Optimi in any jurisdiction in which such offer, solicitation or sale would be unlawful.

With a vertically integrated approach, Optimi intends to cultivate, extract, process and distribute high quality functional mushroom products at its two facilities comprising a total of 20,000 square feet nearing completion in Princeton, British Columbia. To fully investigate the science of mushrooms, the Company has received a research exemption under Health Canada Food and Drug Regulations (FDR) for the use of Psilocybin and Psilocin for scientific purposes at its wholly owned Optimi Labs Inc subsidiary.


Debra BorchardtDebra BorchardtJanuary 29, 2021
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6min2100

Indoor agriculture company Agrify Corporation (Nasdaq: AGFY) has listed its shares on the NASDAQ after pricing its upsized initial public offering of 5,400,000 shares of common stock at a price of $10.00 per share for total gross proceeds of $54 million. The shares began trading on the Nasdaq Capital Market under the symbol “AGFY” on Thursday.

Raymond Nobu Chang, President & CEO of Agrify said, “We’re beyond thrilled to officially announce our IPO. This is an incredible step forward to solidifying Agrify’s foothold in the indoor agriculture and tech space. We look forward to empowering a generation of modern growers to achieve better consistency and quality through the understanding that cultivation techniques must evolve to meet the market’s future needs.” The company said that it does not cultivate, come in contact with, distribute or dispense cannabis or any cannabis derivatives that are currently prohibited under U.S. federal law, but notes that its cultivation solutions can be used within indoor grow facilities by cannabis cultivators if they choose to do so.
In addition to the shares that began trading, Agrify has granted the underwriters a 45-day option to purchase up to an additional 810,000 shares of common stock to cover over-allotments, if any. The offering is expected to close on February 1, 2021, subject to customary closing conditions. Maxim Group LLC and Roth Capital Partners are acting as joint book-running managers for the offering. The company reported net revenue of $4 million in 2019, which grew to $7.7 million for nine months ending September 30, 2020. The net losses were $8.5 million for those nine months in 2020.

Backlog

As of December 31, 2020, Agrify said its backlog, which consists of purchase orders or purchase commitments, was $59.3 million. In the company’s filing, it said, “We expect to recognize revenue of approximately $40 million in 2021 and the rest gradually thereafter. As of December 31, 2020, we have $105 million of carefully vetted potential sales opportunities (which we refer to as our qualified pipeline). Of this, $78 million of the qualified pipeline was generated through our company directly and $27 million through our Agrify-Valiant Joint-Venture. We are presently working to convert this pipeline into confirmed bookings over the next 12 months.”

Horizontal Modular Growing

“We believe that our AVFU is the only product on the market that offers a modular, compartmentalized micro-climate growing system for indoor vertical farming. These 8.5 ft. long x 4 ft. wide x 9.3 ft. tall units each have two tiers of growing space. They are designed to line up horizontally in rows, and they can be stacked vertically up to 3 units tall allowing a total of 6 layers of canopy, effectively taking advantage of previously unused indoor vertical space. The AVFU is a premium indoor grow solution with an MSRP starting at $20,000, and our most recent AVFU deals have been for between 60 and 535 units as our new customers become satisfied that our grow solutions will be an instrumental part of their operations moving forward. We are targeting large scale projects that range in size from $1 million to over $10 million in AVFU hardware sales before any additional revenue from our Agrify Insights™ software and ancillary products and services are realized.”

“A key component of our cultivation solution is our proprietary software, Agrify Insights, which has been developed in-house. This cloud-based software interfaces with a microservices middleware and relational database that integrates with our hardware and provides our managers, facility owners, facility managers, and growers real-time control and monitoring of facilities, growing conditions, and insights into both production and profit optimization. The combination of precise environmental control and automation with data collection and actionable insights empowers our customers to be more efficient, more productive, and more intelligent about how they run their businesses. We believe that the robust data analytics capabilities from our Agrify Insights platform coupled with our AVFU system is enabling our customers to transform their businesses and quality of the product they are cultivating.”


Debra BorchardtDebra BorchardtJanuary 6, 2021
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3min2100

HempFusion Wellness Inc. completed its initial public offering (IPO) of 7,000,000 common shares at a price of $1.00 per share for gross proceeds of $7 million and 10,000,000 units of the company for gross proceeds of $10 million.  The company will begin trading on the Toronto Stock Exchange today under the following symbols:

  • CBD.U – the Common Shares (including the Offered Shares, the Unit Shares (as described below) and the Warrant Shares (as described below));
  • CBD.WT.V – the Warrants; and
  • CBD.WT.U – the 2019 Warrants.
“We are incredibly excited to have completed our initial public offering and begin trading on the Toronto Stock Exchange,” commented Jason Mitchell N.D., HempFusion’s CEO. “The additional $17 million in capital adds to our healthy treasury, providing us with a solid foundation to build from and execute on our strategic plans for 2021 and beyond. Our goals include increased investment into research and development, expanding our sales and distribution networks, and firmly establishing HempFusion as a leader in the dynamic global CBD industry.”
HempFusion is a health and wellness CBD company utilizing the power of whole-food hemp nutrition. HempFusion distributes its family of brands, including HempFusion, Probulin Probiotics, Biome Research, and HF Labs, to approximately 4,000 retailers across all 50 states of the United States and select international locations. HempFusion’s product portfolio comprises 46 SKUs including, tinctures, proprietary FDA Drug Listed Over-The-Counter (OTC) Topicals, Doctor/Practitioner Lines and more. HempFusion says it has an additional 30 products under development. HempFusion is a board member of the US Hemp Roundtable, and HempFusion’s wholly-owned subsidiary, Probulin Probiotics, is one of the fastest-growing probiotics companies in the United States, according to SPINs reported data.
The company said it had revenues of $3 million in 2019 with a net loss of $12 million and total liabilities of $7.7 million.
Mitchell is a naturopathic doctor and brings 25 years of business development, scientific, nutritional, and product development experience to the company’s leadership. Mitchell has in-depth knowledge of the natural supplements industry, Hemp, CBD and probiotics, as well as ingredient sourcing. Mitchell also has extensive understanding and a background in regulatory matters specifically relating to FDA and other U.S. and foreign governmental agencies. Mr. Mitchell previously held the position of Chief Science Officer for Country Life Vitamins, where he developed over 300 products and assisted that company through its acquisition by Kikkoman Foods in 2006.

Debra BorchardtDebra BorchardtDecember 2, 2020
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6min5304

 The independent branded hydroponics company with a comprehensive distribution platform, Hydrofarm Holdings Group, Inc. said it was launching an initial public offering of 8,666,667 shares of its common stock. The initial public offering price is expected to be priced between $14.00 and $16.00 per share. Hydrofarm said it expects to grant the underwriters a 30-day option to purchase up to an additional 1,300,000 shares of its common stock. Hydrofarm has applied to list its shares of common stock on the Nasdaq Global Market under the symbol “HYFM.” The company is hoping to raise $118 million, but the over-allotment option could bring that to $136 million.

Hydrofarm is not a newcomer to indoor growing, but it has targeted the cannabis industry as an area for expansion. The company had net sales for nine months in 2020 of $254 million. The net income was $2.1 million for that same time period. The proceeds are to be used for repaying existing indebtedness, for acquisitions, for working capital, and other general corporate purposes. The company has $113 million in total long-term debt.

Cannabis Restrictions

Despite the company’s desire to work with cannabis it also faces restrictions due to the company’s loans. According to the company’s prospectus, it states, “The Term Loan Agreement prohibits the Subsidiary Obligors from selling our products directly to cannabis growers or cultivators, or to sellers or retailers that sell only to the cannabis industry. The Encina Credit Facility prohibits the Subsidiary Obligors from selling our products to the cannabis industry. As a result, the Subsidiary Obligors do not sell our products directly to the cannabis industry, cannabis growers or cultivators, or to sellers or retailers that sell only to the cannabis industry. We are in compliance with the terms set forth by the Term Loan Agreement and the Encina Credit Facility and maintain policies and procedures that are designed to promote and achieve continued compliance with these requirements.” The company said it sells its products through third-party retailers and resellers which do not exclusively sell to the cannabis industry.

Reputation Risk?

Hydrofarm seems like it is preparing the company for cannabis to become legal and then be able to freely work with the industry, but in the meantime, it is clearly trying to distance itself from its customer base. The filing noted, “Damage to our reputation can be the result of the actual or perceived occurrence of any number of events, and could include any negative publicity, whether true or not. Cannabis has often been associated with various other narcotics, violence, and criminal activities, the risk of which is that our retailers and resellers that transact with cannabis businesses might attract negative publicity. There is also a risk that the action(s) of other participants, companies, and service providers in the cannabis industry may negatively affect the reputation of the industry as a whole and thereby negatively impact our reputation.”

“Today, we believe that a majority of the CEA equipment and supplies we sell to our customers is ultimately purchased by participants in the cannabis industry, though we do not sell to participants in the cannabis industry directly.”

Former Hostess Brands CEO

Mr. Toler has served as our Chief Executive Officer and Chairman of our board of directors since January 1, 2019. Prior to joining Hydrofarm in 2019, Mr. Toler was the Chief Executive Officer of Hostess Brands, Inc. (Nasdaq: TWNK), a food and beverage company, from May 2014 to March 2018. Under his leadership, Hostess successfully re-established the iconic Hostess brand as a leader within the sweet baked goods category, returned the company to profitability, and transitioned Hostess from a private to a public company. Mr. Toler has over 35 years of executive leadership experience in supply chain management and consumer packaged goods, including previously having served as Chief Executive Officer of AdvancePierre Foods, from September 2008 to August 2013, and President of Pinnacle Foods. He has also held executive roles at Campbell Soup Company, Nabisco, and Procter & Gamble. Mr. Toler served on the board of directors of Collier Creek Holdings from September 2018 to September 2020, Hostess Brands from May 2014 to March 2018, AdvancePierre Foods from 2008 to 2013 and Pinnacle Foods from 2007 to 2008. In addition, Mr. Toler has also served as a senior advisor at Oaktree Capital Management, an investment management firm, from September 2013 to April 2014. Mr. Toler holds a B.A. in Business Management and Economics from North Carolina State University. Mr. Toler was selected to serve as Chairman of our board of directors because of his 35 years of executive leadership experience in supply chain management and consumer packaged goods.


Debra BorchardtDebra BorchardtMay 1, 2020
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2min9980

New Leaf Ventures Inc. (CSE: NLV) completed its initial public offering (IPO) of 4,768,871 units at a price of $0.25 per Unit, for aggregate gross proceeds of approximately C$1,192,217. The company had originally intended to raise $5 million.

The company said it intends to use the proceeds for the expansion and business development of its holdings in the United States, as well as for marketing activities, and for ongoing general working capital requirements.

New Leaf Ventures Inc. acquired ownership of New Leaf USA and its subsidiaries, which provide licenses, consulting services, real property, intellectual property and equipment for lease and ancillary services to a Washington-based Tier 3 Producer/Processor focused on cultivating, growing, processing, packaging, and distributing cannabis and cannabis-related products.

Each Unit is comprised of one (1) common share in the Company and one half (1/2) common share purchase warrant. Each Warrant will be exercisable at a price of $0.40 for a period of 24 months from the listing of the Common Shares on the Canadian Securities Exchange, subject to early expiry if the closing price of the Common Shares on the CSE  is equal to or greater than $0.60 per Common Share for a period of ten (10) consecutive trading days.

Following the completion of the Offering and closing of the Acquisition Transaction, the Company has 30,072,547 Common Shares issued and outstanding. The Common Shares have been listed and posted on the CSE and are anticipated to commence trading at market open on May 1, 2020, under the stock symbol “NLV.”


Robert LakinRobert LakinJune 16, 2019
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3min18790

Israeli medical cannabis producer Breath of Life International Ltd. (BOL) cut its valuation for a pending Toronto Stock Exchange initial public offering by about 17%. According to a Canadian regulatory filing on June 14, the company is seeking to list 14% of its shares at a fully allotted valuation of CAD 1.02 billion (USD 827 million), compared to a previous valuation estimate of about $1.19 billion, following its May 23, 2019 prospectus.

Breath of Life produces medical cannabis and cannabis products — including 99%-pure cannabinoids — distributed primarily through pharmacies. The company currently supplies 48 pharmacies from its single facility in the southern Israel kibbutz of Revadim. It is targeting export markets in the E.U., Canada and Australia.

According to the prospectus, BOL showed revenue of $3.5 million in 2018, up from $3 million in 2017, and posted a net loss of $29.3 million, compared with a $6.4 million loss a year earlier. The IPO proceeds will be used to expand operations to Portugal resulting in an annual manufacturing capacity of more than 870,000 kilograms of dried cannabis in Israel and Portugal combined by the end of 2020, the prospectus said.

BOL set a price range of CAD 27-32 per share (USD 20-USD 23.80). Underwriters are BMO Nesbitt Burns Inc., Cowen and Company LLC, and Scotia Capital Inc.

BOL expects to take advantage of recent changes in Israel’s medical cannabis regulatory framework, which went into effect in late April. Under the changes to the country’s long-established medical cannabis program, there is no longer a fixed limit on the number of patients who can be prescribed medical cannabis; the number of physicians allowed to prescribe medical cannabis has been expanded; and, all pharmacies can be certified to distribute medical cannabis.

As a result of the framework changes, BOL forecasts that the number of approved medical cannabis patients in Israel will quadruple to 120,000 by 2022, from 30,000 last year. Earlier in the year, the government approved the export of processed and finished medical cannabis product.

The Israeli government sees a significant economic opportunity in medical cannabis. Various published forecasts peg the sector to be worth from $260 million to as much as $1.1 billion by 2022. In the last year the government committed the equivalent of more than USD $3 million to more than a dozen studies on boosting medical cannabis growing and cultivation.

 

 

 


Debra BorchardtDebra BorchardtJune 10, 2019
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4min19200

The much-anticipated Reverse Takeover for Harborside Health began trading on the Canadian Securities Exchange using the symbol HBOR on Monday. The plan to go public was originally announced back in August of 2018. At that time, Toronto-based Lineage Grow Co. said it would acquire Oakland-based FLRish – which manages Harborside’s retail and dispensary operations – in exchange for newly issued common shares of Lineage worth roughly 200 million Canadian dollars or $152.2 million.

Harborside was a pioneer in the medical marijuana world. It made the first legal cannabis sale in California and has been serving over 300,000 patients and generating over $400 million in sales since those early days. Harborside currently commands 3% of the entire CA retail market, which is by a landslide the biggest market in the country.

The company has previously completed a $26 million Series B funding round and a $14.6 million Series C. Founder Steve DeAngelo’s tireless, decades-long cannabis advocacy has made Harborside the most trusted and respected name in the game.

History

When Steve DeAngelo and Dress Wedding ( yes, his real name) founded Harborside in Oakland in 2006, they had the distinct purpose of providing patients with a safe, trusted source for high-quality medical cannabis products. The San Jose location is one of the first dispensaries in the city. In late 2016, the company acquired a cultivation facility in Salinas, allowing it to grow its own flower, which helped expand the product offerings and increase margins. The company currently employs 250 people in total and they are currently planning the expansion of Harborside locations throughout the Bay Area and eventually to San Leandro and more.

Tax Overhang

One issue clouding the IPO was the tax case that Harborside fought with the government over the 280e business deduction claim. DeAngelo said, “We did not seek this fight with the federal government, but don’t shrink from standing up for our rights and the rights of the cannabis industry when we think they are under threat. Our tax case began in 2009 when we challenged the right of the government to apply 280e to state-legal cannabis businesses. The case has wound through the courts since then, with wins and losses on both sides. Most recently, at the trial court level, the IRS won on the underlying judgment, while we won on the imposition of penalties.”

He went on to add, “We have appealed that ruling to the 9th Circuit Court of Appeals, historically one of the most favorable appeals courts for cannabis cases. We hope for a better ruling there. No matter what, our intention is to pursue this case until we either win or all legal avenues are exhausted. Unless the IRS decides to voluntarily dismiss its case, that process is expected to take several more years.”


Debra BorchardtDebra BorchardtApril 18, 2019
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3min15410

The NASDAQ Markets Group (NDAQ) has been notoriously reluctant to list any cannabis related companies, even if they are only ancillary and not plant-touching. It seems vape distributor Greenlane Holdings Inc. has broken through the company’s barriers.

Greenlane will begin trading on NASDAQ today with the ticker GNLN after upsizing its initial public offering of six million shares with the offering price of $17. The company had expected to price the shares between $14-$16.

According to the company, Greenlane is offering 5,250,000 shares and the selling stockholders are offering 750,000 shares. In addition, the selling stockholders have granted the underwriters a 30-day option to purchase up to an additional 900,000 shares of Class A common stock. The offering is expected to close on April 23, 2019, subject to satisfaction of customary closing conditions.

Greenlane Revenue

Greenlane recorded net sales of $178 million in 2018 and a 102% increase over the $88 million in 2017. The cost of sales in 2018 was $143 million. Still, the company reported a net loss of $6.4 million in 2018.

A significant percentage of the company’s revenue is dependent on sales that it purchases from a small number of key suppliers, including PAX Labs and JUUL Labs. For example, products manufactured by PAX Labs represented approximately 15.6% and 29.4% of Greenlane’s net sales in 2018 and 2017, respectively, and products manufactured by JUUL Labs represented approximately 36.5% and 11.4% of its net sales 2018 and 2017, respectively.

Greenlane shipped over 16.0 million product units to its B2B customers in 2018 compared to over 2.0 million product units to its B2B customers in the fiscal year 2016, representing a growth rate of approximately 687.3%. The company grew its employee headcount from 89 employees as of January 1, 2016, to 256 employees as of December 31, 2018.

Greenlane Chain

Greenlane’s customers include over 6,600 independent smoke shops and regional retail chain stores, which collectively operate approximately 9,700 retail locations, and hundreds of licensed cannabis cultivators, processors and dispensaries. Greenlane also owns and operates two of the most visited North American direct-to-consumer e-commerce websites in the vaporization products and consumption accessories industry, VaporNation.com and VapeWorld.com, which offer convenient, flexible shopping solutions directly to consumers. Greenlane is developing a unique e-commerce platform, Vapor.com, into which its existing e-commerce websites will be consolidated.


StaffStaffApril 8, 2019
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4min15590

Seattle-based fintech company, POSaBIT began trading this morning on the CSE under the ticker PBIT.  The company that serves cannabis retailers by delivering bitcoin-enabled payment processing and point-of-sale systems, with built-in compliance features customized to the state each retailer operates in.   POSaBIT has enhanced its payment service offering by developing incremental features to sell and accept both Litecoin and Bitcoin for purchases, as well as perform EMV card compliance on debit card transactions.

“This is a significant achievement for POSaBIT and we are proud to make this important transition from the private to the public markets,” said Ryan Hamlin, co-founder, and CEO of POSaBIT. “The past year has been an exciting one for the company, marked by a series of milestones. We continued to expand geographically in the California, Colorado, and Washington markets successfully completed the acquisition of DoubleBeam, and rolled-out a fully-integrated POS and payments platform that fulfills an unmet need in the cannabis industry. Our service is now in use at over 120 cannabis merchants across various US states. We are pleased with our traction in the market, as demonstrated by our strong year-to-date growth, and are very encouraged by the continued momentum we saw as we closed out 2018.”

For the nine months ending Sept. 30, 2018, the company generated $1.39 million in revenue, a 266% increase over the prior year for the same time period. The company said that pursuant to private placement financings undertaken in conjunction with the listing, POSaBIT generated gross proceeds of $1.3M. The company’s footprint includes California, Nevada, Oklahoma, Colorado, and Washington.

POSaBIT brings its deep retail, food service, and hospitality expertise to the cannabis sector. It has processed $76M in payments in the hospitality industry in 2017. In February 2018, the company acquired DoubleBeam, which specializes in POS payment processing for the Hospitality sector.

POSaBIT designed and released a new front-end POS console that is suited for cash-only merchants such as the cannabis industry. This entirely new console offers an array of key features, including loyalty programs, in-store digital menus, online ordering / in-store pickup, inventory management, state seed-to-sale compliance, and customizable discounts.

POSaBIT also completed all of the necessary state requirements to support the Leaf system, a seed-sale track and trace software system used by regulators in the State of Washington. POSaBIT offers built-in state compliance – a key component that minimizes risk for owners as they navigate new legal footing. With rich data analytics and reporting, owners more effectively keep track of budtender and product performance, on average resulting in doubled ticket sales.


StaffStaffJanuary 28, 2019
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6min58450

“When a brand is so successful that its name becomes ubiquitous with the product (Kleenex / facial tissue), it becomes “Slang” for the product,” said Peter Miller, CEO of SLANG Worldwide. “We are aiming high for our branded products, and their names will be slang for their categories.”

Slang will be going public this week on Tuesday on the Canadian Securities Exchange in an IPO with an implied market value of $541 million using the ticker SLNG. The company was previously known as Fire Cannabis Inc.

Slang is a combination of National Concession Group, better known as Organa Brands and Firefly vape pens. Organa is based in Denver, CO and is best known for its product called O.penVAPE. In addition to the O.penVAPE line, Organa makes the Magic Buzz cannabis beverages, District Edible gummies and a line of dab products called Bakked.

The real key to the company though is Organa Labs, the part of the company that houses its custom extraction process. The company earns royalty payments through its ability to turn other company’s cannabis products into premium vape pens.

Organa’s revenue for the nine months ending September 30, 2018, was $11,699,259  versus last year’s $8,820,455 for the same time period. Total operating expenses for those same nine months was $4.3 million in 2018 versus $4.6 million in 2017. The company reported net income in 2018 of $4.7 million for those nine months. The O.penVAPE brand is the highest selling brand in Colorado with over $170 million in retail revenue generated since 2014.

SLANG is paying upwards of $200 million for Organa, but Billy Levy, the President of Slang said he considered it more of a merger than an acquisition. Levy and Miller decided that the licensed producer side of the business wasn’t a place for big growth in the cannabis industry. They believe that brands and distribution will be the key places for growth. Organa was the way for them to accomplish this goal.

Miller and Levy are very experienced when it comes to LP’s. The two co-founded Mettrum Health, which was acquired by Canopy Growth Corp. (CGC)  for $430 million. Levy co-founded Virgin MEGA with Sir Richard Branson which was acquired by Nike (N). Miller is also the CEO of Agripharm.

As they built Mettrum, Miller and Levy said they came across Organa. The two companies developed a mutual respect for each other ’s businesses. Organa went from selling its products in Colorado to its current count of ten states. Mettrum was sold and Slang became the new plan. “Our goal was to acquire great brands and pair that with distribution,” said Levy. Organa became a founding partner in Slang.

In addition to the Organa acquisition, Slang is also acquiring NWT Holdings, which is also known as Firefly. This is a dry material vape pen that competes with PAX. Miller said he was most impressed with Firefly’s co-founder Mark Williams who was a design manager at Apple leading the Mac OS X interface. “His design expertise is truly blue chip,” said Miller. “We want to leverage his expertise of industrial design across the whole portfolio as well.” He said that the next generation of Firefly vape pens is going to occupy a super-premium segment of the market.  Firefly will also be launching its own oil products this year.

The purchase price for Firefly is $16 million,  50% in cash and 50% through the issuance of approximately 7,450,870 shares issued at a deemed price of $1.50 per share. The company reported $3.1 million in revenue for the nine months ending September 30, 2018, but reported a net loss of $440,000 for that time period.

Slang will also have the right of first refusal to license the Green House Brands, which includes the Green House Seed Co. and Strain Hunters. The Green House Seed Company has produced over 60 award-winning cannabis strains and was founded by Arjam Roskam.  Green House also holds an exclusive master license to Strain Hunters, a series of documentaries centered around the quest for preservation of the cannabis plant, and the series has co-developed documentary series alongside HBO, VICE, and National Geographic.

Following the successful completion of the acquisitions, it is expected that Slang will expand the businesses of Organa and Firefly as a branding and marketing company focused on developing reputable brands and quality hardware products.

 



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