Changing economic times have caused an Ohio marijuana and hemp retailer to rethink its latest acquisition.
Green Growth Brands, which owns medical marijuana dispensaries and the nation’s largest chain of CBD retail locations in mall kiosks, on Wednesday dropped its $310 million all-stock bid to acquire Moxie Holdings, a Texas-based, privately held, vertically integrated, multistate cannabis operator.
The company reported a loss of $30.2 million for the fiscal quarter ended Sept. 30.
Company executives attributed the loss to costs from the rapid expansion of its Seventh Sense-branded CBD kiosks, now in nearly 200 shopping malls.
“While we continue to be open to collaborating with other industry leaders, we need to ensure we are focused on building our operational strengths,” Green Growth Brands CEO Peter Horvath said in a statement.
The acquisition would have accelerated the growth of Green Growth Brands’ THC and CBD businesses by entering more dispensaries nationwide and diversifying the company’s business model, according to Corey Hammill, managing director and partner at Paradigm Capital, a Toronto-based investment group.
In addition to its expansive mainstream retail presence for CBD distribution, Green Growth Brands currently owns and operates two dispensaries in Nevada and holds the license to open another nine there, as well as 35 dispensaries in Florida and three dispensaries in Massachusetts.
Green Growth Brands, which trades on trades on the Canadian Securities Exchange as GGB and on U.S. over-the-counter markets as GGBXF, must repay a $5 million advance to Moxie by Jan. 31, 2020, and $4 million in deal fees by July 1, 2020.
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