Humble & Fume, a North American distributor of cannabis and cannabis accessories, has formed HC Solutions Holdings, a new joint venture with Green Acre Capital Distribution, for the purpose of expanding distribution of cannabis throughout the United States.
The JV will initially be focused on accelerating the company's expansion into cannabis distribution operations in California. Subsequent to the formation of the JV, Green Acre completed a $2 million investment directly in the JV. Green Acre has funded its investment through an option agreement with Johnson Brothers, a wine, spirits and beer distributor in the United States.
Johnson Brothers has the right to acquire Green Acre’s interest in the JV on the same terms and circumstances, including U.S. federal legalization of cannabis, as the First Option. Green Acre will then have an opportunity to increase its ownership in the JV to 50% by investing up to an additional $8 million over the next two years. Green Acre would make this investment by selling additional options to Johnson Brothers, giving it the right to acquire Green Acre’s additional interests in the JV.
"The additional $2 million investment by Johnson Brothers, funded through their Green Acre option agreement, demonstrates continued support for our US expansion strategy. Humble is excited to launch in the California market, delivering something new to the cannabis brands in that area," said Joel Toguri, Chief Executive Officer of Humble. "We are actively executing on our growth strategy. As our business evolves and expands, we continue to be hyper focused on sustainable profit generation and positive cash flow to deliver long-term shareholder value."