SPAC Northern Lights To Acquire Cannabis-Focused Financial Services Provider For $185M

Special purpose acquisition corporation Northern Lights Acquisition Corp. NLIT and SHF, LLC dba Safe Harbor Financial, a cannabis-focused financial services provider, signed a definitive business combination agreement, under which Northern Lights' will acquire Safe Harbor from a subsidiary of Partner Colorado Credit Union.

Upon the closing of the transaction, Northern Lights and Safe Harbor will be led by Sundie Seefried, founder and CEO of Safe Harbor. The boards of directors and managers of Northern Lights, PCCU, and Safe Harbor have unanimously approved the proposed business combination.

"Safe Harbor is the most compelling investment opportunity we have encountered in the cannabis industry as both operators and investors. Safe Harbor is one of the only multi-state financial service organizations to successfully navigate the highly regulated cannabis banking industry, providing services that operators in other industries take for granted," John Darwin and Joshua Mann, Co-CEOs of Northern Lights, both of whom will remain on Northern Lights' Board of Directors upon completion of the transaction, stated. "Setting the gold standard for regulatory compliance, as well as providing access to growth capital across the entire cannabis value chain, Safe Harbor is uniquely positioned to scale. We are confident that our collective experience in the cannabis industry and strong pipeline of lending opportunities are complementary to the incredible business Sundie and her team have established."

Transaction Overview

Northern Lights will acquire Safe Harbor, a subsidiary of PCCU for a total of $185 million, of which $70 million will be paid in cash and $115 million in shares of Northern Lights Class A common stock. The estimated post-transaction equity value of the company will be approximately $327 million, assuming no redemptions by the stockholders of Northern Lights. The transaction will provide up to $107 million of gross proceeds (assuming no redemptions), including $117 million from Northern Lights' cash-in-trust and a fully committed $60 million PIPE from institutional investors.

Safe Harbor was launched in 2015 to provide an unmet need – compliant access to banking and financial services for the rapidly growing U.S. cannabis industry. Over the past seven years, the company has grown to nearly 600 accounts spanning 20 states. Additionally, Safe Harbor has processed over $11 billion in transactions with $4 billion in 2021 and has grown deposits at a 73% CAGR since inception.