MedMen stock is down over 13% today after MedMen Enterprises (CSE:MMEN) (OTCQX:MMNFF) announced the termination of its proposed takeover of private cannabis firm PharmaCann.
MedMen Stock Drops on Industry Headwinds and Regulatory Hurdles
MedMen Enterprises initially announced the all-stock takeover of PharmaCann on December 24 last year, and the deal appeared to be nearing completion last month following the expiration of the waiting period under the HSR Act 1976. However, MedMen has today withdrawn from the deal, citing a variety of reasons, including market underperformance, regulatory hurdles, and the company's increased focus on California. MedMen stock has dropped 13.5% to $1.98 following the announcement.
Debt Forgiveness
The terms of the termination will see MedMen forgive approximately $21 million USD in debt in exchange for the transfer of assets relating to three entities. These include a cultivation and production facility and a separate retail location in Illinois, as well as a retail license for Greater Chicago and another license for a facility in Virginia. MedMen CEO Adam Bierman cited PharmaCann's Illinois operations as the most attractive opportunity for the company and welcomed the addition of those assets with the dilution of MedMen shares.
>> HVT Stock Up 4% on Receipt of New Cultivation License
MedMen Appoints New CFO
Also today, MedMen announced the appointment of Zeeshan Hyder as Chief Financial Officer, succeeding Michael Kramer, who will stay on in a consultancy role until the end of the year. Hyder previously served as the company's Chief Corporate Development Officer and played an integral role in taking the company public and raising over $500 million USD for direct investment. The company's new CFO will now be faced with the challenge of stimulating growth in MedMen stock, which is down over 75% in the last 12 months.
MedMen Enterprises Breaks Bad?
Following last week's parody on South Park, MedMen has teamed up with the hit AMC series Breaking Bad ahead of the release of its sequel Netflix feature 'El Camino' on Friday. A tweet from the show's official Twitter account reads, "Smoke it if you got it, but see Badger if you don’t. 21+. 34° 4’ 29.6” N 118° 23’ .9” W." Those coordinates lead to a MedMen cannabis shop in West Los Angeles, where Matt Jones, the actor who plays Badger, hung out and signed posters on Sunday.
Featured Image: Canva
