MedMen Enterprises Inc. has signed a definitive agreement to acquire the retail operations and license for a location in Santa Ana, California, through an all-stock transaction with Captor Capital Corp. The store is currently MedMen branded and managed.
Upon closing, MedMen will issue 3,740,228 Class B subordinate voting shares to Captor Capital Corp., a Canadian publicly-traded investment company. At the current market price of the Shares, the transaction is valued at approximately US$16,000,000. The final purchase price is subject to adjustment for accrued liabilities at the time of closing.
“MedMen Orange County is strategically located in one of the most affluent regions of Southern California with a limited number of licensed dispensaries,” said Adam Bierman, MedMen chief executive and co-founder. “This is an asset that we are already intimately familiar with through the management contract. We have direct visibility to market data, including consumer demographics and growth trends. This acquisition enhances our first mover advantage in a strategic location with robust sales and long-term growth potential.”
Transaction Highlights:
- The Santa Ana store is located in the only city in all of Orange County, population 3.2 million, to allow dispensaries.
- The store is currently MedMen managed and branded, providing seamless integration.
- Attractive deal valuation based on key store metrics, including revenue, margins, customer base and growth.
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The transaction is subject to regulatory approvals by various local and state authorities and other customary closing conditions. The Company expects the transaction to close within 60 days.
MedMen Chief Executive Officer Adam Bierman and President Andrew Modlin together own a combined 2.8 percent of the common shares of Captor Capital. As such, an independent committee of the Board of Directors of the Company reviewed and approved the transaction.
Date: November 19, 2018
Source: MedMen