Cannabis M&A And Financings Nearing $10 Billion YTD, Up 77% YoY
The Viridian Cannabis Deal Tracker is an information service that monitors capital raise and M&A activity in the legal cannabis industry. Analyzing within 12 key industry sectors, the Viridian Cannabis Deal Tracker provides cannabis companies, investors, and acquirers with the data, trends, and intelligence they need to make informed decisions regarding deal valuations, terms, and structures. Since its inception, the Viridian Cannabis Deal Tracker has tracked and analyzed more than 2,400 capital raises totaling over $29 billion as well as more than 800 M&A transactions. Find it exclusively on Benzinga Cannabis every week!
INVESTMENT AND M&A ACTIVITY IN THE CANNABIS INDUSTRY
8/26/2019 – 8/30/2019
KEY INSIGHTS & TAKEAWAYS
- One fewer capital raise closed this past week compared to the same week last year. These fewer raises coincided with lower capital raised in aggregate as well as a smaller average raise size. While this week was slow compared to last year, we expect the record pace of capital raise activity in 2019 to continue.
- Of the seven capital raises, all but two used equity structures, and those two debt raises were the smallest tracked this past week.
- Of the seven capital raise transactions, only one was closed by an ancillary business, with the rest involving licensed operators (Cultivation & Retail, Infused Products & Extracts, Hemp).
- The largest raise tracked was closed by a company developing a hybrid alcohol/cannabis breath detection device, and this firm has attracted investments from mainstream venture capital firms. While most institutional investors are precluded from investing in cannabis in the U.S., these groups have become increasingly active in investing in "picks and shovels" businesses (those supplying goods and services to the licensed entities as opposed to the licensed entities themselves).
MERGERS & ACQUISITIONS:
- This past week saw six closed M&A transactions, slightly below the eight deals closed in the same week last year but a continuation of the accelerated M&A activity we have seen to date in 2019.
- Of the six closed transactions, four involved public companies as the buyers, and one of the remaining two deals was a reverse takeover for a company to become public.
- Again this week, most of the targets acquired were private companies.
- Licensed cannabis operators continue investing in or acquiring specialized Consumption Devices providers as businesses in the space seek to differentiate their vaporizer offerings via novel or more advanced technologies or designs.
- States with relatively limited licenses, whether medical or adult use, continue attracting interest for acquisition. This past week, we saw acquisitions of compaines in NV (Henderson Organic Remedies) and NY (Fiorello Pharmaceuticals).
MERGERS & ACQUISITIONS
Capital Raises by Week
Capital Raises by Sector
MERGERS & ACQUISITIONS
M&A Activity by Week
M&A Activity by Sector
Photo by Javier Hasse.
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