Trulieve now world's biggest, most-profitable potco

THE BIG IDEA

Hi all,

Lots of juicy stories today. Let’s dive in:

Trulieve now the world’s biggest PotCo
MedMen founders sue new partners
Ceres/Parallel SPAC deal crumbles

Tell me what you’re thinking at alex@weedweek.net,

Alex

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TOGETHER WITH

Tallahassee Fla.-area based MSO Trulieve completed its $2.1B acquisition of MSO Harvest and is now the world’s largest and most profitable cannabis company.

Trulieve initially became the dominant player in Florida, which has recently become a target state for many MSOs. Though MED only, it’s now the third largest market in the country, after Colorado and California.
Forbes

Trulieve will have 149 retail locations in 11 states more than 3.1 million square feet of cultivation and just over 8,500 employees.
Tallahassee Democrat
In Q2 2021 the companies had a combined $317.6M in reported revenue, more than any other MSO. In the same quarter Trulieve reported net income of $40.9M on revenue of $215.1M.
CEO Kim Rivers says Trulieve is now building out regional hubs in Pennsylvania and Arizona, where Harvest had operations and was based.
Jackie Bryant reports in Forbes that the deal gives the company more than $350M in cash and equivalents, as of June 30, plus Trulieve’s recently announced $350M debt financing and Harvest’s $55M from the sale of its Florida license to Planet 13.

The deal closes weeks after Rivers’ husband, J.T.Burnette was convicted on federal corruption charges unrelated to Trulieve.

During the trial, prosecutors played an audio recording in which Burnette claimed to have successfully influenced the licensing process to benefit the company.
Testifying under oath, Burnette said that in the recording he had been “bragging about something that happened before my time.“
According to an S.E.C. filing, Burnette is a minority owner of a company that provides construction and related services to Trulieve. In 2020, Trulieve’s property and equipment purchases from the vendor totaled $96.7M.
Trulieve has asserted it has nothing to do with the case. Neither the company nor Rivers were accused of wrongdoing.
Burnette’s sentencing is scheduled for November 8.

Pennsylvania MED patient and comic artist Brian “Box” Brown has been a vocal critic of Trulieve.

QUICK HITS

Politics:

Pennsylvania lawmakers renewed a REC push.
Cannabis Wire
Axios asks if movement to legalize, decriminalize and/or make available cannabis, psychedelics, gambling and sex works signifies “The End of Vice.”
Seattle became the biggest U.S. city to decriminalize psychedelics.
Marijuana Moment

Business:

Data firm BDSA found slowing year over year growth, and some declines in several western states in August.
New Cannabis Ventures
Bank of America downgraded Canopy Growth stock.
MarketWatch
A new MJBiz report on women and minority cannabis executives found women and people of color now hold a smaller percentage of executive positions than in 2019.
Tilray chairman and CEO Irwin D. Simon has received nearly $30M in total compensation so far this calendar year. Weeks ago the company said it was closing a British Columbia facility, cutting about 160 jobs.
GrowthOp
Justin Bieber is launching a pre-roll brand with Palms.
Vogue
Responding to SEC charges that California-based C3 International “scamm[ed] at least 40 investors” out of $2M. CEO Steele Clarke Smith told WeedWeek the SEC is “leveraging theft of the C3 I.P. by filing a complaint that is libelous, false and unsubstantiated.”
Dai Truong shared his thoughts on Hall of Flowers.
Highly Objective
Top psychedelics VC Sa’ad Shah shared two red flags that turn him off a pitch.
LA Times, Business Insider
Miguel Martin, CEO of Canadian player Aurora, which reported a net loss of C$134M on C$54.8M in revenue for the quarter ended in June, called the idea that only REC matters a “fallacy.”
Business Insider
Clint Eastwood won $6.1M in a trademark dispute suit against a CBD company.
Ganjapreneur

Crime:

The Alameda County, Calif. (Oakland) Sheriff’s Office raided more than a dozen facilities in what might have been the biggest pot bust in Bay Area history. Police found 500,000 plants and more than $10M in cash.
Mercury News

International:

In Mexico, nearly 100,000 people have disappeared from drug-related violence since 1964.
NY Times
Canna Law Blog looks at what the German elections meant for Europe’s biggest MED market.

Fun and interesting:

Business Insider checks out a 420-friendly co-working space We Toke Club in Chicago.

COMPANY MILESTONES

MSO Ascend Wellness Holdings closed a deal to buy an Ohio MED shop and confirmed an agreement to enter another.
Indoor agriculture company Agrify acquired extraction equipment companies Precision Extraction Solutions and Cascade Sciences for a combined $50M.
MSO Jushi acquired The Apothecarium‘s Las Vegas dispensary.
Social impact accelerator Gromentum Lab launched in Chicago.

JOB MOVES

MSO MariMed appointed Steve West VP investor relations.
Point of sale platform FlowHub named former Uber exec Leandre Johns COO.
As it plans to go public, Leafly named Suresh Krishnaswamy CFO.
Glass House Brands appointed Mark Vendetti CFO.
James M. Cole, the Obama Justice Department official who wrote the 2013 Cole Memo essentially greenlighting state-legal cannabis, joined the National Cannabis Roundtable, the lobby fronted by former Speaker of the House John Boehner (R).
Cannabis and psychedelics attorney David Feldman opened a new law firm to complement his advisory service Skip Intro.
Travis Copenhaver joined law firm Vicente Sederberg as a partner in Michigan.

WEEDWEEK HIGH SOCIETY -- 10/5/21

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