Stem Holdings Acquires Western Coast Ventures To Access California Cannabis Market

Stem Holdings Inc STMH said it executed a definitive agreement to acquire Western Coast Ventures, Inc. in an all-stock deal. The acquisition will allow Stem Holdings to cultivate, process and distribute cannabis across California.

What Happened

The value of the deal is $3.5 million and will be conducted in all stock, with STEM issuing 2 million shares to existing Western Coast Ventures shareholders. After the deal is closed, former shareholders of Western Coast Ventures will own 7.3 percent of Stem's outstanding stock.

The Cannabis Capital Conference returns to Toronto April 17-18!

Western Coast Ventures has $2 million in working capital and has established a joint venture with ILCA Holdings. ILCA has received a limited Conditional Use Permit for a Marijuana Production Facility in San Diego, California.

Why It's Important

The joint venture, in which Western Coast Ventures will hold 51-percent interest for an aggregate purchase price of $1.5 million, will operate an advanced cannabis facility, manufacture cannabis-derived products, and distribute cannabis and cannabis products throughout California.

Stem anticipates the construction of the facility, estimated at $3.5 million, will be financed by the joint venture with cash on hand and other non-dilutive sources of income.

The construction of the facility is in progress and is expected to be completed in the fourth quarter of 2019.

Related Links:

Emerald Growth Partners Pre-Qualified For Operations In Michigan

Cresco Labs To Acquire Origin House In $825M Deal