Insider

New Jersey finally legalizes

Summary List PlacementWelcome to Insider Cannabis, our weekly newsletter where we're bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom. Sign up here to get it in your inbox every week. Happy Friday readers, This week was dominated by the news that New Jersey...

GettyImages 1199475587

Summary List Placement

Welcome to Insider Cannabis, our weekly newsletter where we’re bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom.

Sign up here to get it in your inbox every week.

Happy Friday readers,

This week was dominated by the news that New Jersey finally legalized cannabis, months after over two-thirds of New Jerseyans voted to legalize. 

The state’s difficulty in passing overwhelmingly popular legislation offers a cautionary tale to other states that are hoping to legalize to pave over budget deficits and spur criminal justice reform. It’s a lot easier said than done. And it may take years to actually see the promised tax revenue from a fully established cannabis market.

In other news, there was a flurry of deals in the cannabis sector this week. Yeji and I have a look at what that means for New York — a key market for cannabis companies — as well as what that means for the US more generally

We don’t have a crystal ball, but we outlined some specific acquisition targets in our story. We’re already being proven correct.

Last, I moderated a pair of panels at Benzinga’s Cannabis Capital Conference with Louie Reformina, of Turing Points Brands, and Andrew Thut, of 4Front. We touched on a number of issues including M&A trends in cannabis, ironing out the kinks of state legalization, and more.

Let’s hit it. 

-Jeremy (@jfberke) and Yeji (@jesse_yeji)

Here’s what we wrote about this week:

New York is pushing to legalize marijuana. Here are the prime acquisition targets and the types of deals you can expect.

As New York lawmakers push hard to legalize cannabis this year, cannabis companies are eyeing acquisitions as a way to enter the state. Experts told Insider that private companies and struggling MSOs looking to sell off assets to stabilize their balance sheets, are likely to be acquisition targets. 

The world’s largest cannabis companies are jockeying to dominate the lucrative US market. 7 top CEOs and executives break down the deals you can expect.

The US cannabis industry is set for a flurry of deals as Democrats on Capitol Hill make cannabis reform a core issue and new state markets open. Insider spoke with CEOs and execs at seven of the top US and Canadian cannabis companies who said they’re focused on expanding to dominate the lucrative US market.  

Meet the 13 power players shaping the future of New Jersey’s potentially $1 billion market for recreational marijuana

Governor Phil Murphy signed legislation to legalize cannabis in the Garden State on Monday. Meet the 13 power players, from lawmakers to executives, shaping the future of New Jersey’s cannabis industry.

New York cannabis M&A is already heating up

Struggling cannabis companies with licenses in New York are likely acquisition targets. Ascend Wellness said it would take a majority stake in MedMen’s New York assets.

There may be other deals to come as New York moves toward cannabis legalization

Executive Moves

  • Terry Booth, the former CEO of Aurora Cannabis, will be taking over as CEO of Australis Capital
  • Clever Leaves announced that Hank Hague would be joining the company as chief financial officer 
  • Acreage Holdings announced that CFO Glen Leibowitz is leaving the company. Steve Goertz, former CFO of sgsco and a partner at Bespoke Capital Partners, will be taking over as CFO starting April 2.
  • Agrify announced the formation of its new advisory board on Wednesday, including Rosie Mattio, CEO of MATTIO Communications, and Matthew Kressy, founding director of the MIT Integrated Design & Management program. 
  • Fyllo announced it would be bringing on Twitter veteran Katie Ford as the company’s new COO.
  • New Jersey has filled the remaining spots on its Cannabis Regulatory Commission, including Maria Del Cid, director of policy at New Jersey Department of Health, William Wallace of the United Food and Commercial Workers International Union, and Sam Delgado a former VP at Verizon. 

Deals, launches, and IPOs

Policy moves

  • New Jersey officially legalized cannabis on Monday after Governor Phil Murphy signed legislation that he and lawmakers had been negotiating for weeks. Read our list of the top power players of New Jersey cannabis.
  • State lawmakers in Maryland this week proposed a plan to legalize and tax the sale of cannabis in the state, The Baltimore Sun reports.
  • Morocco is legalizing cannabis production for medical use, Reuter reports
  • President Biden’s attorney general nomination Merrick Garland said federal law enforcement officials should not go after those who are complying with laws in states that have legalized cannabis.

Science and research

Earnings roundup

  • The Valens Company released its fiscal Q4 earnings on Wednesday, reporting adjusted EBITDA of C$4.3 million for Q4.
  • Innovative Industrial Properties released its Q4 and full year 2020 results on Wednesday, reporting $37.1 million in revenue for the quarter, and $21 million in net income.
  • Cronos released its 2020 Q4 and full year results on Friday, reporting an adjusted EBITDA loss of $53.1 million in Q4 and losses of $147.3 million for the year.
  • Next week EnWave, Indus, High Tide, and 48North will report earnings.

Chart of the week

Cannabis software and media companies raised $518.8 million in 2020, according to Viridian Capital Advisors, more than double what they raised in 2019. Read our story about the cannabis tech boom last year.

Capital raises by cannabis software and media companies

What we’re reading

Billionaire Beau Wrigley Says His Cannabis Company Will Be Bigger Than The Family Candy Business (Forbes)

Opinion: Legalizing Marijuana The Right Way (Gotham Gazette)

Teen Use, Mental Health Spur Talk of Pot Curbs (Bloomberg)

Powerful House Dem bought cannabis stocks after pushing decriminalization (Fox Business)

Join the conversation about this story »

NOW WATCH: Why Pikes Peak is the most dangerous racetrack in America

Leave a Reply

%d bloggers like this: