According to a recent press release, the Parent Company has entered into agreements to expand the supply of high quality, California grown cannabis.
The company has announced a $50 million strategic investment in GH Group, Inc. (“Glass House”) through a private placement offering by Mercer Park Brand Acquisition Corp., a special purpose acquisition company, which has entered into a definitive agreement to merge with Glass House.
The Strategic Investment is expected to close concurrently with the closing of Mercer Park Brand’s qualifying transaction.
In connection with the Strategic Investment, The Parent Company has also entered into a non-binding letter of intent with Mercer Park Brand pursuant to which the parties have agreed to negotiate towards a long term cannabis biomass offtake agreement and a retail distribution agreement which would enable The Parent Company’s suite of branded products to be sold across all Glass House retail locations (the “Glass House Agreements”), each of which are expected to be entered into upon closing of the Qualifying Transaction.
The Qualifying Transaction is expected to close by Q3 2021, subject to customary closing conditions and approvals.
The Company also announced today that it has signed a definitive binding agreement to acquire four acres of licensed high-quality outdoor cannabis cultivation located in Sonoma County, California from a consortium of experienced cannabis farmers, Mosaic.Ag an affiliate of Soma Rosa Farms, for a total consideration of up to $17 million in cash and common shares in the capital of the Company. This Cultivation Acquisition is expected to close in Q2 2022, subject to customary closing conditions and regulatory approvals.
The Company has also entered into a cultivation and supply agreement pursuant to which the consortium of farms will continue to provide cultivation services and supply the Company with high-quality cannabis pursuant to the agreement upon the terms set forth therein.
“These partnerships are a fantastic opportunity to secure long-term access to over 900,000 pounds of high-quality, low-cost, California-grown cannabis for use across our expanding portfolio of branded products,” said Steve Allan, Chief Executive Officer of The Parent Company.