Cansortium and RIV Capital Announce Business Combination with Significant Growth Potential and Regulatory Catalysts in Key U.S. Markets
Cansortium Inc. and RIV Capital Inc. have announced a significant business combination that is set to create a vertically integrated, multi-state cannabis company with operations in key U.S. markets. The combined company will have a strong presence in Florida, New York, Texas, and Pennsylvania, covering approximately 25% of the U.S. population. This strategic move is expected to leverage the strengths of both companies, with Cansortium bringing robust operating expertise and RIV Capital contributing a substantial cash balance of approximately US$66 million.
The transaction, which has the support of ScottsMiracle-Gro, involves the exchange of RIV Capital’s existing convertible notes for a new class of non-voting Exchangeable Shares of Cansortium, eliminating US$175 million of debt. The Combined Company is expected to be well-capitalized with a pro forma cash balance of approximately US$74 million as of March 31, 2024, enabling it to fund growth initiatives and drive long-term value creation.
The deal is subject to shareholder and court approvals, as well as regulatory clearances. Upon closing, the Combined Company will operate under the Cansortium name and continue trading on the Canadian Securities Exchange and the OTCQB Venture Market. The headquarters will be in Tampa, Florida, with Robert Beasley serving as the Chief Executive Officer.
The transaction is expected to position the Combined Company as a leader in the cannabis industry, with a strong operational footprint in four major U.S. states. The deal is anticipated to close in the fourth quarter of 2024, pending all necessary approvals and conditions. The management of both companies expressed optimism about the merger, highlighting the growth opportunities and synergies that the combined entity will bring to the market.
