It’s time for your Daily Hit of cannabis financial news for December 21, 2021.
On The Site
Planet 13 Holdings Inc. (CSE: PLTH)(OTCQX: PLNHF) is buying Next Green Wave Holdings Inc. (CSE: NGW)(OTCQX: NXGWF) in a deal valued at approximately C$91 million ($70 million). Planet 13 is paying a premium of 44% to the shareholders based on the company’s average share price over the last ten days. Next Green Wave is an integrated premium seed-to-shelf craft cannabis producer offering products through its in-house brand portfolio and wholesale flower for other large cannabis manufacturers. The company owns and operates a 35,000 sq. ft. indoor facility in Coalinga, CA, which is home to its nursery, cultivation, distribution, and future packaging business. Planet 13 said it plans on keeping the company’s management team.
Organigram Holdings Inc. (NASDAQ: OGI) is buying Laurentian Organic Inc. for C$36 million, plus earnouts. The Laurentian acquisition further strengthens Organigram’s position in the Canadian market through the expansion of the company’s portfolio into premium products, including hash and craft cannabis, in addition to providing an important presence in the province of Quebec through scalable cultivation and operational footprint. Laurentian is one of the leading hash companies in Quebec and has the current capacity to cultivate approximately 600 kg of flower and one million units of hash annually. The company said that expansion efforts are expected to increase that to approximately 3,000 kg of flower and two million units of hash by the second half of 2022. Laurentian is also expected to benefit from access to additional high-quality indoor flower supply and input material for hash from Organigram’s Moncton facility, which is expected to produce 70,000 kg of annualized production capacity by the end of fiscal 2022.
It’s the most wonderful time of the year. For cannabis consumers and cannabis businesses alike. It’s no secret that cannabis consumers consider cannabis to be an important part of their holiday traditions. So much so, that cannabis dispensaries see a noticeable lift in sales each year around the holidays. We kicked off the 2021 holiday season with Green Wednesday. Green Wednesday is the day before Thanksgiving every year. Many people call it the Black Friday of cannabis. Headset found Green Wednesday sales showed a 33% increase in total retail sales compared to the previous four Wednesdays. As we move into the winter holidays, you can expect to see a boost in cannabis retail sales.
Netherland-based lighting company Signify (Euronext: LIGHT) has made an agreement with ams OSRAM (SIX: AMS) to buy the Austin, Texas-based Fluence for $272 million (EUR 242 million) on a cash and debt-free basis. The company is making the acquisition in order to enter the North American indoor growing market. Fluence is planned to operate as an entity within Signify’s agricultural lighting business in Division Digital Solutions and the deal is expected to close in the first half of 2022. Fluence employs more than 200 people. In the trailing 12 months (October 2020 to September 2021), Fluence generated $141 million (EUR 124 million) in revenue.
How does one make $11 million when the company records less than $10,000 in revenue for a year? Apparently by pumping and dumping the stock says the SEC (Securities and Exchange Commission). The SEC is opposing an attempt by HempAmericana (OTC: HMPQ) to have its complaint dismissed. HempAmericana was incorporated in 2014 with a factory and equipment aimed at processing, bottling, and selling products made of industrial hemp, including CBD oil. Since its incorporation, HempAmericana has never been profitable. From 2017 through May 2020, HempAmericana generated a mere $9,727 in revenues. Salvador E. Rosillo is HempAmericana’s CEO. The complaint alleges that almost a third of the company’s money was used for stock promotion – not for actually growing the business.
In Other News
Mind Medicine (MindMed) Inc. (NASDAQ: MNMD), announced that the U.S. Food and Drug Administration (FDA) has placed a clinical hold on its IND submission intended to support the initiation of a Phase 2b trial of lysergic acid diethylamide (LSD) for the treatment of generalized anxiety disorder (GAD). Additional detail regarding the FDA’s decision is expected within 30 days.
“Our team has a tremendous sense of urgency to bring new treatments, such as LSD, to the many patients in need, particularly given the growing mental health epidemic,” said Robert Barrow, Chief Executive Officer and Director of MindMed. “We remain highly confident in the therapeutic potential of LSD to usher in a new treatment paradigm for these disorders and we look forward to working closely with FDA to satisfy all outstanding concerns as rapidly as possible.”