General Cannabis Announces Proposed Acquisition of Third Colorado Cannabis Operator to Expand Footprint in Denver

On August 13, 2019, VCBeat (WeChat ID: vcbeat) learned that General Cannabis, a player in the cannabis supply chain, plans to acquire its third Colorado-based cannabis operator. Upon closing of the transaction, General Cannabis is expected to pay consideration for substantially all tangible and intangible assets, consisting of 60% in cash and 40% in the company’s common stock. The number of common shares issued at closing will be determined based on the 30-day volume-weighted average price.

The seller in this transaction operates two indoor cultivation facilities and retail cannabis dispensaries, and has been rated by The Times magazine as possessing a world-class cannabis gene library, making it one of the best dispensaries in Denver.

Previously, the Colorado House of Representatives approved Bill 1090 (“HB-1090”), allowing publicly traded companies to acquire Colorado-licensed cannabis businesses. Once the relevant provisions of the bill are finalized, such acquisitions will become binding transactions.

“We are pleased to announce our plan to acquire the third licensed cannabis operator in Colorado,” said Michael Feinsod, CEO of General Cannabis. “This acquisition will expand our operations into downtown Denver, providing strong support for our growth strategy. The acquired company’s resources will broaden our customer base, enabling us to fully leverage the capabilities we will have once House Bill 1090 is finalized. We look forward to closing the transaction and integrating the business. This acquisition will bring our projected cannabis cultivation area to approximately 45,000 square feet.”

“Colorado has consistently led the nation in cannabis legalization. With statewide retail cannabis sales exceeding $1.5 billion, we believe that Colorado’s cannabis cultivators and retailers will capitalize on this significant new public market opportunity.” Michael Feinsod further stated, “This cannabis operator is successful, and we believe it represents an excellent acquisition target. We also plan to continue acquiring additional licensed cannabis assets in Colorado and other regulated markets. Supported by a robust platform, we are well-positioned to create synergies with our partner cannabis operators in Colorado.”

General Cannabis is a cannabis supply chain company headquartered in Denver, Colorado, USA, and is publicly listed on the U.S. stock market. The company’s business scope covers nearly every segment of the cannabis supply chain. It provides leased spaces and related supporting facilities (such as commercial real estate and equipment) to licensed cannabis operators and growers, helping them meet their production needs. Additionally, the company offers security services for the cannabis industry, including armed guards, cash transportation, and cannabis logistics. Furthermore, it provides financing and consulting services to cannabis companies, covering design, construction, cultivation, compliance, applications, and remote management services.

(Compiled by He Lang)