Cansortium, a vertically integrated, multi-state cannabis company operating under the FLUENT brand, and RIV Capital, a vertically integrated cannabis company operating the Etain brand in New York, are combining to form one of the biggest multi-state cannabis operators in the U.S.
Cansortium will acquire all of the issued and outstanding Class A common shares of RIV Capital, which has a strategic relationship with The Hawthorne Collective, a subsidiary of ScottsMiracle-Gro.
The combined company will have operations spanning Florida, New York, Texas and Pennsylvania, which will cover approximately 25% of the U.S. population. Operations in these states will be comprised of 8 cultivation and processing facilities and 42 retail dispensaries.
It will also have a pro forma cash balance of approximately $74 million and, as part of the deal, The Hawthorne Collective's intended exchange of its existing convertible notes in RIV Capital for a new class of non-voting exchangeable shares of Cansortium will eliminate $175 million of debt.
The companies said they expect cost synergies of approximately $5 million to $10 million annually over the next few years due to anticipated cultivation, processing and operating efficiencies, corporate integration and eliminating duplicative public company costs.
The combined company will operate under the Cansortium name and the Cansortium Shares will continue to trade on the Canadian Securities Exchange under the symbol "TIUM.U" and on the OTCQB Venture Market under the symbol "CNTMF." Upon closing of the transaction, it is expected that the combined company will be headquartered in Tampa, Fla., which is the current location of Cansortium's corporate offices, and Robert Beasley, the current Chief Executive Officer of Cansortium, will act as Chief Executive Officer of the combined company.
