PALM BEACH, Fla., March 23, 2021 /PRNewswire/ — 2019 was not an especially good year for M&A activity in the cannabis market, however 2020 went out with a bang, with more than $600 million in deals announced immediately following the November elections. Industry observers say that prospects for the New Year are expected to continue the explosive year-end trend with a backlog of nearly $2 billion in deals heading into 2021. The COVID-19 pandemic boosted sales of cannabis products, and election results opening up five new states to legal cannabis use and possible federal regulatory reform are further boosting prospects. According to the Cannabis Industry Journal, analysts now predict the U.S. cannabis market is poised to double by 2025. The article said: “Growth is expected to be led by multi-state operators who have achieved scale, cleaned up their balance sheets and stockpiled dry powder for roll-up acquisitions. Cannabis companies raised nearly $134 million in the two weeks before Election Day, a 185% increase over the same period last year. Most of the money flowed to multistate operators. In addition, the biggest stocks by market capitalization saw a roughly 20% bump ahead of the election and now are trading at record volumes, providing plenty of stock currency for further acquisitions. Active Companies active today in the cannabis related markets include: Item 9 Labs Corp. (OTCQX: INLB), Curaleaf Holdings, Inc. (OTCQX: CURLF) (CSE: CURA), Green Thumb Industries Inc. (OTCQX: GTBIF) (CSE: GTII), Sundial Growers Inc. (NASDAQ: SNDL), Greenrose Acquisition Corp. (NASDAQ: GNRS).
Cannabis Industry Journal continued: “In light of the maturing industry and the 2019 bust, the valuation model for acquisitions in the cannabis space is evolving from one based on sales, typically associated with emerging growth industries, to a more mature industry model based on profits or Earnings Before Interest, Taxes, Depreciation, and Amortization