Greenlane Holdings: What to Expect from the Next Major Cannabis IPO

Greenlane

Greenlane is planning an initial public offering (IPO) on the NASDAQ exchange that will raise about $98 million, making Greenlane Holdings Inc the first US-based cannabis company to trade on the major US exchange.

First US-Based Cannabis Company on NASDAQ

Greenlane is popular for its production of cannabis vape accessories and hardware such as pipes and rolling papers for retailers and consumers in Canada, the US, and across the globe. However, its largest business is wholesaling the vape products from Pax Labs Inc, which makes cannabis consumption hardware, and from Juul Labs Inc, which produces nicotine vape pens.

In regards to going public, a spokesman of the Florida-based company stated that Greenlane will be the first US-based cannabis company to be listed on the Nasdaq exchange. Other US marijuana companies such as Innovative Industrial Properties Inc. (NYSE:IIPR) and Turning Point Brands Inc. (NYSE:TPB) are listed on the New York Stock Exchange.

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IPO Details

Greenlane has indicated that 5.3 million shares will be on offer, with 4.7 million being offered by the company itself and the rest from stockholders. According to the company’s filings with the SEC the shares will be trading for between $14 to $16 Thursday on NASDAQ and Greenlane expects to raise around $98.1 million. Cowen & Co and Canaccord Genuity, the lead underwriters, will get access to 0.8 million shares from shareholders willing to sell.   

Greenlane has applied to trade under the GNLN symbol, and the shares will be priced as from next week. The company will likely get approved because it does not cultivate, distribute, or sell marijuana, a barrier that is blocking many other US cannabis companies from listing on the major exchanges in the US. Also, Greenlane’s products do not violate the US federal drug paraphernalia regulations.

Greenlane has seen its revenue grow significantly in the past two years, with sales almost doubling in FY2018 to $178.9 million, up from $88.3 million reported in FY2017; $160.4 million in sales were in the US, with $15.6 million in Canada, and $2.9 million in the rest of the world.

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