On May 30, 2024, Cansortium Inc., a multi-state cannabis operator, agreed to acquire RIV Capital Inc., consolidating their operations under a definitive arrangement agreement. RIV Capital shareholders will receive 1.245 Cansortium shares for each RIV Capital share, resulting in Cansortium shareholders holding 51.25% and RIV Capital shareholders 48.75% of the combined entity. The transaction, expected to close in Q4 2024, will enhance their market presence in Florida, New York, Texas, and Pennsylvania, covering 25% of the U.S. population.

The combined company will operate eight cultivation and processing facilities and 42 retail dispensaries, boasting a pro forma cash balance of $100.64 million (US$74 million). Cost synergies of $6.8-13.6 million (US$5-10 million) annually are anticipated through operational efficiencies and corporate integration. The deal eliminates $238 million (US$175 million) of debt via The Hawthorne Collective’s exchange of convertible notes for non-voting exchangeable shares.

Legal advisors for Cansortium include Wildeboer Dellelce LLP and Shumaker, Loop & Kendrick, LLP, with ATB Securities Inc. as financial advisor and Paradigm Capital Inc. providing a fairness opinion. RIV Capital’s legal counsel includes Cassels Brock & Blackwell LLP and Goodwin Procter LLP, with Moelis & Company LLC as financial advisor and INFOR Financial Inc. providing a fairness opinion.

The deal strengthens the strategic partnership with The Scotts Miracle-Gro Company and leverages an expanded talent base, aiming for significant growth and profitability.