The Viridian Cannabis Deal Tracker is an information service that monitors capital raise and M&A activity in the legal cannabis industry. Each week the Tracker analyzes/aggregates all closed deals and allocates each transaction to one of twelve key industry sectors in which the deal occurred (from Cultivation to Brands), the region in which the deal occurred (country or U.S. state), the status of the company announcing the transaction (public vs. private) and the type of deal structure (equity vs. debt).
The Viridian Cannabis Deal Tracker provides the deal data/terms/valuations/structures and market intelligence that cannabis companies, investors, and acquirers utilize to make informed decisions regarding capital and M&A strategy. Since its inception in 2015, the Viridian Cannabis Deal Tracker has tracked and analyzed more than 2,500 capital raises and 1,000 M&A transactions totaling over $45 billion in aggregate value. Find it exclusively on Benzinga Cannabis every week!
INVESTMENT AND M&A ACTIVITY IN THE CANNABIS INDUSTRY
1/4/2021 – 1/8/2021
Transactional Activity: There were two more capital raises and $49.5 million higher volume this week than in the prior week. Compared to the same week last year, there were the same amount of transactions and a $13.7 million higher volume. This week's average deal size was $13.2 million vs. $9.7 million in the prior-year period.
U.S. MSOs wasted no time in hitting the equity market after the Georgia Senate flip, which sent stock prices soaring. Columbia Care (US$102 million), Curaleaf (US$217 million), Jushi (US$32 million), TerrAscend (US$175), and Planet 13 ($47) all priced deals, and AYR announced that it would sell equity under its December shelf registration. The Curaleaf and TerrAscend transactions are the two biggest equity issues by MSOs since the heady 2018 RTOs days. (Note: only the Jushi deal closed during the week ended 1/8/21).
We think this is smart corporate finance – take the money while the market wants to give it to you. Despite all of the rosy projections of imminent cannabis legalization, we have seen that there can be many bumps in the road. The Viridian Value Tracker now shows median valuations of 18.4x consensus 2021 EBITDA for U.S. Cultivation & Retail companies with more than US$100 million of market cap estimates. Companies are no longer leaving piles of money on the table by issuing equity at these prices. Managements anticipate a fresh round of state legalizations with extensive capital requirements for expansion of cultivation capacity, particularly in states …