The Week In Cannabis: Glass House, Canopy, Curaleaf, Trulieve, Virginia And More

Market Trading EssentialsApril 9, 2021

6 minutes read

In a week where overall markets traded up, cannabis stocks were in the red, despite a series of big news, M&A and financing announcements.

Special purpose acquisition company Mercer Park Brand Acquisition Corp. (NEO:BRND.A.U) (OTCQX: MRCQF) will acquire vertically integrated California cannabis operator Glass House Group for $567 million.

The deal implies a $1.024-billion equity valuation and an approximate enterprise valuation of $691 million.

Curaleaf Holdings, Inc. (CSE: CURA) (OTCQX: CURLF) purchased European operator EMMAC Life Sciences. The U.S.-based company agreed to pay $50 million in cash and 17.5 million in stock — worth roughly $260 million.

In addition, Curaleaf teamed up with an institutional investor to secure $130 million in financing for further expansion of Curaleaf International.

Meanwhile, Canopy Growth Corporation (TSX: WEED) (NASDAQ: CGC) announced it will buy The Supreme Cannabis Company, Inc. (TSX: FIRE) (OTCQX: SPRWF) for about CA$435 million ($345.7 million).

The deal follows Canopy Growth’s purchase last week of cannabis brand Ace Valley.

Benzinga Cannabis content is now available in Spanish on El Planteo.

“These cannabis deal numbers just keep getting bigger. Mercer Park is grabbing Glass House Group for over half a billion dollars, while Canopy Growth is picking up The Supreme Cannabis Company for $435 million. These numbers can’t help but feel inflated. The revenues make the break-even so far into the future that one wonders if we are having another bubble,” Debra Borchardt, editor-in-chief of Green Market Report, told Benzinga.

ETFs were all down. Over the five trading days of this week:

The ETFMG Alternative Harvest ETF (NYSE: MJ): lost 2.6%.
The AdvisorShares Pure Cannabis ETF (NYSE: YOLO): tumbled 3.6%.
The AdvisorShares Pure US Cannabis ETF (NYSE: MSOS): dropped 1.5%.
The Cannabis ETF (NYSE: THCX): slipped 1.55%.
The Amplify Seymour Cannabis ETF (NYSE: CNBS): dropped 2%.
The SPDR S&P 500 ETF Trust (NYSE: SPY) was up 2.55%.

Trulieve Cannabis Corp. (CSE: TRUL) (OTC: TCNNF) announced a marketed public offering of its shares. The company opted to sell 5 million subordinate voting shares in the United States and Canada in an underwritten public offering, at a price of C$50.00 per share (or $39.63 per share). Total proceeds before deductions, commissions and other expenses, are expected to come in at approximately $198.1 million.

Policy And Advocacy

Virginia became the first state in the South to legalize adult-use cannabis after the state’s lawmakers approved several changes to cannabis bills SB 1406 and HB 2312, proposed by Virginia Governor Ralph Northam.

The two bills would create a statutory timeline for the legalization of the commercial cannabis market in the Old Dominion, and also enable the possession and growing of cannabis by adults. The personal use provisions of the law to take effect on July 1, 2021, instead of January 1, 2024, which was originally passed by lawmakers.

Illinois hit another record in marijuana sales, surpassing $100 million in March. According to the state Department of Financial and Professional Regulation, a total of 2,317,315 marijuana items worth $109,149,355 were sold over the period.

Texas lawmakers unanimously voted for a medical cannabis expansion bill in the Public Health House Committee. With the Committee’s passage, the bill is now moved to the Calendars Committee to be scheduled for a vote by the House of Representatives.

The medical cannabis bill, HB 1535, sponsored by Chairwoman Stephanie Klick, proposes adding PTSD (for veterans only), cancer, and chronic pain to the list of health conditions that qualify patients for treatment with medical cannabis. Furthermore, the bill would increase the THC cap for medical cannabis products from 0.5% to 5%.

A new coalition dubbed The Cannabis Freedom Alliance was launched, backed by right-wing billionaire Charles Koch and criminal reform advocate Weldon Angelos, alongside:

The Reason Foundation: a libertarian think tank;
The Global Alliance for Cannabis Commerce: a cannabis trade organization;
The Weldon Project: a nonprofit that fights for the release of those incarcerated for cannabis offenses.

Earnings Reports

Planet 13 Holdings Inc. (OTCQX: PLNHF) reported it has generated $23.8 million in the first three months of 2021. March revenue amounted to $9.7 million, representing its single-month record.

Verano Holdings Corp. (CSE: VRNO) (OTCQX: VRNOF) reported its revenue amounted to $355 million in fiscal 2020, representing a 196% year-over-year increase.

KushCo Holdings, Inc. (OTCQX: KSHB) generated $32.9 million in revenue in the second quarter, representing a 23% sequential increase, and 9% year-over-year growth.

Slang Worldwide Inc. (CSE: SLNG) (OTCQB: SLGWF) released preliminary, unaudited full-year and fourth-quarter 2020 financial results with quarterly revenue of CA$9.66 million ($7.7 million), compared to CA$8.7 million in the same period of 2019.

Agrify Corporation (NASDAQ: AGFY) announced Q4 and year-end financial results. Full-year 2020 revenue nearly tripled year-over-year to $12.1 million.

Find all the details on these and other earnings reports on Benzinga Cannabis’ Earnings Center.

Financings And M&A

IM Cannabis (CSE: IMCC) (NASDAQ: IMCC) continues to strategically expand in Canada with its second acquisition of 2021. This week it reached a definitive agreement to acquire MYM Nutraceuticals and its Licensed Producer subsidiary Highland Growth for C$85 million ($67.6 million).

Trulieve acquired three Pennsylvania-based medical marijuana dispensaries for $60 million in cash and stock.

InterCure LTd. (TASE: INCR), doing business as Canndoc, is poised to acquire medical cannabis brand Better Holdings for $35 million.

Fyllo raised $30 million via an oversubscribed Series B round co-led by JW Asset Management and Sol Global.

Organigram Holdings Inc. (TSX: OGI) (NASDAQ: OGI) purchased The Edibles & Infusions Corp. for $22 million.

Cansortium Inc. (CSE: TIUM) (OTCQB: CNTMF) secured some $12 million in financing through a sale of roughly 17.14 million of its units at 70 cents per unit.

Akerna (NASDAQ: KERN) closed its acquisition of Viridian Sciences.

Other News

Orange County, New York’s Industrial Development Agency approved local financial incentives for cannabis company Green Thumb Industries Inc (OTCQX: GTBIF) (CSE: GTII) to build a marijuana cultivation and manufacturing facility.

Green Thumb plans to buy the remaining eight lots, covering around 40 acres, at the Warwick Valley Office and Technology Corporate Park to construct a state-of-the-art cultivation and manufacturing facility.

Cronos Group (NASDAQ: CRON)-backed hemp and cannabis licensed producer NatuEra is exporting THC from Colombia to the United States. The shipment was imported by California’s Biopharmaceutical Research Company and was approved by the U.S. DEA and Colombia’s National Narcotics Control Board.

Stigma Grow and its parent company, CanadaBis Capital Inc. (TSXV:CANB) signed a third-party production agreement with Sundial Growers Inc (NASDAQ: SNDL) to manufacture several of Sundial’s hydrocarbon concentrates.

Aleafia Health Inc. (TSX:AH) (OTCQX: ALEAF) launched a new everyday cannabis brand, dubbed Divvy.

Subversive Acquisition LP (OTCQX: SBVRF)(TSX: SVX)(NEO: SVX.U) announced that InterCure, an Israel-based company it will be combining with this month, signed an agreement with Berner’s famed cannabis brand Cookies for its European expansion.

Detroit-based Common Citizen and San Francisco-based Sherbinskis have launched a partnership for Common Citizen to grow Sherbinskis’ world-famous cannabis strains in Marshall, Michigan.

Fast-acting cannabis edibles brand Azuca announced a new partnership with Everest Apothecary to bring infused edible products to medical cannabis patients in New Mexico.

Azuca CEO Kim Rael told Benzinga, “We are proud to work with Everest to bring Azuca’s chef-quality edible products to the New Mexico market. With our patent-pending TiME INFUSION™ technology, we are able to deliver consistent, trustworthy and fast-acting edibles consumers can rely on. As adult use cannabis legalization in New Mexico looks imminent, we believe Everest is the perfect partner to allow us to continue our expansion and fulfill the demand for high-quality infused products.”

Lil Wayne’s cannabis and lifestyle brand, GKUA, inked a deal with The Torch at LA Memorial Coliseum to host all 4/20 events for years to come. There will also be a debut VIP Party and Performance, UPROAR at The Torch at LA Memorial Coliseum, on August 13th 2021 featuring Lil Wayne, Young Money and Friends.

Veriheal announced a $20,000 Innovation in Cannabis scholarship to fund students pursuing degrees in the cannabis industry to support upcoming talent and bring fresh perspectives to the field. The scholarship launched last year and has been doubled to offer 20 grants in the amount of $1,000 each to qualifying student applicants.

The Emerald Cup will honor hemp activist and Native American leader Winona LaDuke with the 2021 Willie Nelson Lifetime Achievement Award. LaDuke will be honored on this Sunday, April 11, 2021 at 4:20PM PDT during the virtual “The Emerald Cup Awards Show” broadcast live on Social Club TV.

Executive Moves

Find out all about the latest executive moves at:

JMP Group, GTI, Curaleaf, Conception Nurseries, Myconic, AMP, Neon, NCR, 22nd Century, cbdMD

Kiaro Holdings, Team Hytiva, Hervé Edibles