MTech, an acquisitions firm that went completed a $50-million IPO earlier this year, announced Oct. 11 that it had entered into a definitive merger agreement with MJ Freeway LLC, a seed-to-sale data tracking business with a footprint in 11 countries and TK U.S. states. The resulting, as-yet-unnamed company will be listed on the Nasdaq.
All told, the new company will be debt-free and will boast more than $60 million in balance sheet cash.
Cannabis Business Times spoke with MJ Freeway co-founder and CEO Jessica Billingsley, who said the deal opens up a spectrum of possibilities at a time when the fragmented cannabis industry is taking on global marketplace aspirations.
“This gives us a position of strength in terms of the balance sheet that we’ll have available to us to execute our strategy and to really make sure that we're able to expand our product development at the rapid and extensive effort and depth that the cannabis industry requires,” Billingsley said, “as well as gives us the ability that would have been challenging previously to look at some strategic acquisitions within our states.”
The boards of both MTech and MJ Freeway approved this merger unanimously. The move builds off an ongoing trend of consolidation across the cannabis industry—rapidly expanded corporate structures that require more complex operational tools.
“It’s the big problem,” Billingsley said. “It’s why we built MJ Platform, our Generation-2 product. … We saw the need for a true ERP (Enterprise Resource Planning) for the cannabis industry, for this ability to integrate not only across the entire supply chain—which we did have in our legacy products—but really also at a true enterprise level across all facets of the business, across multiple states, multiple countries, multiple countries, and still have that executive dashboard view.”
Just last month, MJ Freeway announced Ruth Ann Kraemer as new CFO. In a public statement at the time, she said. "I'm pleased to join the team at such a promising time in the company's development. MJ Freeway is uniquely positioned to continue thriving in the growing cannabis market and I look forward to working with its Board and Management team to help scale the business and develop long-term value."
Top photo courtesy of Adobe Stock