Some of the largest multi-state cannabis companies in the U.S. are executing reverse stock splits as they ready for listing on major stock exchanges ahead of the country's plan to reschedule medical cannabis as a less dangerous drug.
Verano Holdings, with retail operations across 13 U.S. states and 14 production facilities, today said its board has approved a 1-for-5 reverse stock split of the company’s common stock, a move expected to reduce Verano’s total issued and outstanding shares of common stock and increase in the price per share.
“The Reverse Stock Split marks another significant step forward for Verano and our future and builds on a series of strategic initiatives we’ve executed to position Verano ahead of growth and U.S. capital markets opportunities,” said Verano CEO George Archos in a statement. “On the heels of the historic medical cannabis rescheduling announcement and in anticipation of prospective reforms that may follow in the near future, the reverse stock split is a prudent strategic measure that prepares the Company for listing on a major U.S. exchange, which we believe is in the best interests of our employees and stockholders.”
Last week Curaleaf, another cannabis MSO with more than 150 dispensaries in 17 states, announced a similar 1-for-3 reverse stock split.
"This important step is part of Curaleaf's long-term effort to achieve the listing of our shares to a major U.S. stock exchange," said Curaleaf CEO Boris Jordan in a statement. "Rescheduling of medical cannabis has created a potential pathway toward uplisting to a major U.S. exchange, and we're now more prepared than ever. With a hearing on the full rescheduling of cannabis expected to end in July, and U.S. Treasury guidance supporting the normalization of the industry forthcoming, we believe there will soon be greater clarity around the regulatory and tax framework for our industry. These developments should improve access to capital, broaden the investor base, and further legitimize cannabis in the public markets. We are preparing today to move quickly and decisively when that opportunity comes into view."
Vireo Growth, which has been busy buying several cannabis companies to grow its retail and production footprint, is planning an even more extensive stock consolidation. Its board today approved a ratio of 30-for-1 and for share consolidation, which would reduce the number of issued and outstanding subordinate voting shares from 1,455,017,319 to approximately 48,500,577.
