Weedmaps, a marijuana review site, operating an online U.S. platform, has decided to go public in a $1.5 billion deal. Reuters first reported news of the deal on Wednesday.
The cannabis technology company said on Thursday it has agreed to go public through a merger with Silver Spike Acquisition Corp, a special purpose acquisition company (SPAC), which raise funds in an initial public offering (IPO) with the aim of buying a private company.
Weedmaps is a special example of a business focused on the cannabis sector listing on a U.S. stock exchange. Companies that are involved with selling marijuana or “plant touching” cannot list shares in the U.S.
Weedmaps was founded in 2008 by Doug Francis and Justin Hartfield in California. The company sells a cloud-based operating system for cannabis retailers as well as hosting a review and ratings platform for sellers.
“When you look at what we’re offering (to investors), there’s really not too much else like it,” WMH Chief Executive Chris Beals said in an interview.
From the deal, Weedmaps expects to receive gross proceeds of up to $575 million, in part from proceeds Silver Spike had raised and also through $325 million in a private investment in public equity, or PIPE, transaction.
Investors in the PIPE include funds from the Federated Hermes Kaufmann Funds, Senvest Management LLC and AFV Partners.
Weedmaps is on track to deliver $160 million in revenue and has been profitable for its entire 12-year history, according to CEO Beals.