Medicine Man Technologies went on a company spending spree, literally. The group has been very busy, and they spent a pretty penny lately — buying up eight dispensaries in two days, and ten different companies in three months.
The acquisitions include deals to snap up eight more marijuana businesses, including Colorado-based canna brands such as Dabble Extracts, Purplebee’s Extracts, and Los Sueños Farms. Also on the list are research and medical marijuana companies MedPharm Holding and Green Equity, a Columbian medical marijuana licensee.
Starbuds, which just happens to be one of Colorado’s largest chains of dispensaries, agreed to sell a handful of their stores to Medicine Man Technologies. The deal was announced September 3. Starbuds sold five stores for a little more than $31 million in cash and shares of Medicine Man Technology stock. The next day, the group announced that it has agreed to buy Colorado Harvest Company. The chain of three dispensaries is located in Denver and Aurora, and sold for a pretty penny: $12.5 million in cash and stock.
So, what spurred the binge buys? It all started right after Colorado lawmakers passed a bill that allows for publicly traded businesses (like Medicine Man Technologies) to hold ownership stakes in cannabis companies. The new law doesn’t go into effect until November, though, and that means the deals are binding agreements until then (aka nothing is official yet).
It hasn’t been released if the dispensaries will become part of the chain of Medicine Man dispensaries or not.
As part of the acquisition deals, Starbuds’ Brian Ruden and Colorado Harvest Company’s Tim Cullen will join the new ownership group in executive roles. In a statement on the deal, Cullen noted that “Following the passage of this law, the time was never more right for us to join the outstanding team at Medicine Man Technologies, who is now free to invest in the industry, given the synergies involved. Their growing team of Colorado cannabis pioneers is very impressive, and we are happy to be aligned with their joint efforts, all soon to be under one roof,” he said, adding, “Furthermore, the management team at Medicine Man Technologies is incredibly accomplished, and they are executing successfully on their plan to bring financial discipline and a clear strategy in their efforts to build the region’s premier cannabis company. We are delighted to join them in this next leg of growth.”
In an interesting twist, in 2018 Cullen sold a dispensary license to Starbuds to help pay off a tax bill. The Aurora location isn’t included in the current deal with Medicine Man Technologies. Starbuds still owns six dispensaries in Colorado and has another one in the works in Denver — that doesn’t include locations in Oklahoma, Maryland and Jamaica.