In a blockbuster cannabis deal orchestrated by a Philadelphia law firm, high-flying marijuana retailer MedMen is acquiring grower-and-dispensary operator PharmaCann in an all-stock transaction valued at $682 million.
"We believe this is the largest acquisition merger ever in the legalized cannabis industry," said Joshua Horn, a partner at Philadelphia's Fox Rothschild LLP.
Horn, along with Bill Bogot of Fox's Chicago office, engineered the deal and represented the privately held PharmaCann. Named "Trailblazers in Cannabis Law" by the National Law Journal last month, the pair lead Fox's nationwide network of cannabis attorneys.
The merger doubles the number of states where MedMen will operate to 12.
MedMen, often called "the Apple Store of Weed," is a dominant marijuana brand in California, New York, and Nevada. The Los Angeles-based company operates 14 high-end dispensaries in those three states. PharmaCann, with corporate headquarters in Chicago, operates growing facilities and dispensaries in Illinois, New York, Maryland, Massachusetts, Michigan, and Ohio.
PharmaCann recently won a permit to open a Pennsylvania marijuana grower-processor operation in Lackawanna County and previously was granted the right to open three dispensaries in the Keystone State. PharmaCann also has applied for a cannabis grower and dispensary license in New Jersey, Horn said. The Garden State permits will be awarded in November.
Pending approval by regulatory agencies, PharmaCann growing facilities and retail outlets will be rebranded as MedMen. The combined entity will trade under the over-the-counter ticker MMNFF and will be vertically integrated in all the state markets in which it operates with the exception of Maryland.
"This would not have been possible even two years ago and is a testament to how far both the industry and these two companies have evolved," said Adam Bierman, MedMen's chief executive officer and founder in a statement.
The merger agreement is expected to be signed on Oct. 24. The estimated closing of the deal at the end of the calendar year.
"Both companies have great teams of executives and share a great vision for the future," Bogot said. "We look forward to working with them both. They'll be even greater than the sum of their parts."
The acquisition marks one of the most dramatic cannabis business deals in a month with a phenomenal number of mergers, public stock offerings, and reverse takeovers.
Many cannabis industry insiders believe the federal government may soon address marijuana on a national level, Horn said. Congressman Dana Rohrerbacher (R., Calif.) on Friday said President Trump "intends on keeping his campaign promise" to legalize medical marijuana from coast-to-coast.
"If there is a change, you'll be able to go across the state lines," Horn said. "After the national elections it may happen. The new MedMen will be well positioned to be a true national brand."