Are any public cannabis companies potential Leveraged Buyout (LBO) or Recap candidates?
The recently announced Curaleaf (OTCQX: CURLF) acquisition of Bloom can be considered an LBO. The acquisition, valued at 8x 2021 EBITDA, included 6x EBITDA in seller notes as consideration.
Neither Curaleaf nor its subsidiaries will guarantee the debt, which will only be by recourse to the equity and assets of Bloom.
Only one company in Viridian Capital Advisor’s database- Red White & Bloom (OTCQX: RWYBF) appears to be trading low enough for a full buyout. Several other companies, however, appear to be capable of repurchasing a significant portion of their outstanding equity.
AYR Wellness is the only company on the list that publicly announced a share repurchase program, with others appearing to be candidates. Seventeen other companies tracked do not have analyst estimates but may be potential candidates.
Partial recaps may also be an attractive alternative means of providing cash to owners in private companies.
The combination of languishing stock prices and more available and lower-cost debt could lead the cannabis industry in a direction few of us would have expected a year ago.
Show Notes:
Are Share Buybacks or Recaps Ahead For Cannabis Stocks?
https://www.viridianca.com/chart2
Host:
Josh Kincaid, Capital Markets Analyst & host of your cannabis business podcast.
https://www.linkedin.com/in/joshkincaid/
Episode 873 The #TalkingHedge…
Your Cannabis Business Podcast.
βCovering cannabis products, reviews, business news, interviews, investments, events, and more.
https://www.theTalkingHedgepodcast.com
Music Info:
Song: Dark Trap Beats Hard Rap Instrumental | Gang | 2018Artist: LuxrayBeats
Keywords:
Hemp News, Weed News, Cannabis News, Marijuana News, Cannabis Business, Marijuana Business, Cannabis Industry News, Marijuana Industry News, Weed News 420, Talking Hedge Podcast, Cannabis Podcast, Marijuana Podcast, Business Podcast, CBD podcast, THC podcast, Cannabis Pitch Deck, Marijuana Pitch Deck, Marijuana Investment Deck, Cannabis Investment Deck, Cannabis Compliance, Cannabis Data, Cannabis Banking, Cannabis Investment, Pot Stocks, Cannabis Stocks, Weed Stocks, Marijuana Stocks, Cannabis Data, Marijuana Data, Cannabis Analytics, Marijuana Analytics, Cannabis Sales Data, Marijuana Sales Data
Josh is not an investment adviser. The Talking Hedge is long gold and silver. Listeners should always speak to their personal financial advisers. This is only entertainment.
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