Marijuana Stocks: Another Weed SPAC Deal, GrowGeneration Buys Char Coir – Investor's Business Daily

Greenrose Acquisition Corp. (GNRS), a cannabis-focused special purpose acquisition company, has agreed to buy four U.S. cannabis companies for $210 million, while growing-supplies retailer GrowGeneration (GRWG) has acquired Char Coir, which produces popular hydroponic growing materials made from coconut fiber.

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The deals, both announced on Monday, are the latest efforts at consolidation in the U.S.’ cannabis industry, as hopes grow for broader nationwide cannabis reform. Marijuana stocks mostly rose on Monday.

Greenrose Acquisition

Greenrose Acquisition will change its name to the Greenrose Holding Company before completing the purchases of the four companies. It also plans move from the Nasdaq Capital Market to the OTCQX Best Market. Greenrose also plans to list on the NEO, an exchange in Canada, once the transaction closes.

Since cannabis is federally illegal in the U.S., the Nasdaq and NYSE don’t allow listings of companies that handle the plant directly.

The companies to be acquired by Greenrose are Shango Holdings, Futureworks, Theraplant and True Harvest. Those companies, together, run a handful of dispensaries, cultivation and processing facilities across seven states.

The deal follows an acquisition spree involving special-purpose acquisition companies, or SPACs, over the past year. And it follows a broader marijuana stocks rally this year that peaked in February. A SPAC is a company that is already public that exists solely to acquire other companies and, in turn, bring them public. The process is less rigorous than a traditional IPO.

In rolling up the four companies, Greenrose hopes to tap U.S. states where licenses to operate are limited, like Nevada, Arizona and Connecticut’s medical market. Greenrose also said it hopes to consolidate in “highly fragmented” states like California, Colorado and Oregon. The company also anticipates “evaluating select distressed and undervalued assets.”

Greenrose will buy the companies for around $210 million. The deal will consist of $170

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