Cannabis In New York: Capital Raises And M&A Activity Accelerates [Chart]

On March 31, 2021,  New York became the 15th state to legalize recreational cannabis and is poised to become one of the largest markets for cannabis in the world. 

• Little progress has been made in enabling legislation, however, because Gov. Cuomo and Senate leaders are at an apparent impasse over who should lead the new Office of Cannabis Management and Cannabis Control. The 2021 legislative session ended without any official cannabis nominations. 

• The cannabis capital markets are not waiting. In a previous graph of the week, Viridian projected that over $2 billion of capital would need to be spent to ramp up the state’s cultivation capacity with significant additional capital to increase the number of dispensaries.

• This week’s graph shows YTD capital raises and M&A deals with New York based companies as either acquirers or targets. Both have accelerated to record levels. Little of the cash raised has been put to work in New York pending the establishment of the actual regulations but it is clear that significant capital will be employed prior to the expected 18-month start date for first legal sales.

The Viridian Capital Chart of the Week highlights key investment, valuation, and M&A trends taken from the Viridian Cannabis Deal Tracker.

The Viridian Cannabis Deal Tracker is a proprietary information service that monitors capital raise and M&A activity in the legal cannabis and hemp industry. Each week the Tracker aggregates and analyzed all closed deals and segments each according to key metrics:

• Industry Sector (one of 12 sectors, from Cultivation to Brands)

• Dollar value of the transaction

• Region in which the deal occurred (country or U.S. state)

• Status of the company announcing the transaction (Public vs. Private)

• Deal structure (equity vs. debt)

• Key deal terms (Pricing and Valuation)

The Viridian Cannabis Deal Tracker provides the market intelligence that cannabis companies, investors, and acquirers utilize to make informed decisions regarding capital allocation and M&A strategy.

 Since its inception in 2015, the Viridian Cannabis Deal Tracker has tracked and analyzed more than 2,500 capital raises and 1,000 M&A transactions totaling over $50 billion in aggregate value.

The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Más contenido sobre cannabis en Español en El Planteo.

Photo: Patrick Tomasso on Unsplash