Denver-headquartered services provider General Cannabis Corp has entered into a non-binding term sheet to acquire substantially all of the assets of The Organic Seed, LLC, doing business as Cannaseur.
Cannaseur is a vertically integrated cannabis license holder located in Pueblo West, Colorado. In addition to the Cannaseur dispensary and cultivation facility, the term sheet also includes their infused products line, Dabtek.
General Cannabis is taking this action based on the signing of Colorado House Bill 1090 (“HB-1090”), a recently approved law allowing public companies to own Colorado licensed cannabis companies.
Once the regulations surrounding the implementation of the law are finalized, the Company plans to enter into a binding transaction.
The non-binding term sheet provides for consideration of $1.2 million in cash and $0.9 million in shares of the Company’s common stock for virtually all of the tangible and intangible assets of Cannaseur.
“This is what we have been waiting for, the finalization of a legal framework that permits publicly traded companies to own and operate cannabis companies within Colorado.”
Michael Feinsod, General Cannabis
“This is what we have been waiting for, the finalization of a legal framework that permits publicly traded companies to own and operate cannabis companies within Colorado. We have been working in Colorado for six years, leading the state’s revolution into legalized cannabis sales,” said Michael Feinsod, Executive Chairman of General Cannabis.
“Our 85 employees operate within the regulated cannabis industry and we are eager to bring our professional services to the state as an owner and operator. Cannaseur provides a solid base for us to leverage our skillset as HB-1090 is enacted.”
“Colorado has been the national leader in legalized cannabis rollout. With statewide trailing twelve month retail sales of over $1.5 billion, we believe Colorado cannabis cultivators and retailers are poised to take advantage of this new significant access to the public capital markets,” said Feinsod.
“The leading operators in Colorado have achieved success operating at scale and, we believe, are excellent acquisition candidates. We have known Ryan Griego and Nick Dremel since 2014, and have watched the growth and success of their operations throughout the implementation of regulated cannabis. We are excited to have them join our team. We plan to continue to acquire additional licensed cannabis assets within the state and other regulated markets. Our strong platform can create a synergistic opportunity for Colorado operators looking to grow with us.”
Brian Andrews, the Chief Financial Officer of General Cannabis, stated, “We believe that with some modernization and improvements to the existing cultivation center, we can increase production by more than 50% in the first year of ownership. Having an established retail presence also positions Cannaseur with a strong continued base for its in-house production. We plan to seek to acquire additional retail dispensaries throughout Colorado to leverage the synergies of our corporate platform.”
Hunter Garth, Vice President of Development, will be leading the company’s Colorado HB-1090 related efforts. Hunter added, “We expect that Colorado licensed cannabis businesses will quickly see the synergies of being part of the General Cannabis platform. We welcome and opportunity to demonstrate how they can succeed with us.”
HB-1090 will also allow General Cannabis’s Colorado-based divisions to leverage their experience for significant growth.
General Cannabis’s Operations Division, Next Big Crop (‘NBC’), stands ready to assist participants as they seek to enter the State of Colorado.
Iron Protection Group (‘IPG’), the company’s Security Division, has a force of guards moving throughout the state between dispensaries, cultivation centers, banks and other industry participants.Cannabis Business Worldwide