Glass House Brands (NEO: GLAS.A.U) is accelerating the timeline for closing on its greenhouse. The recently de-SPAC’ed firm, whom is known for its large cannabis cultivation facility in California, is now set to acquire that large facility by the end of the third quarter of 2021.
Despite setting a name for itself as one of the largest cannabis cultivators in California with the capital markets, the company actually has yet to begin the retrofit process of the facility, given that it does not yet own the property. The revised agreement will see that facility acquired a bit sooner than originally planned however, with the company taking a little more risk in exchange for acquiring the asset sooner.
Under the original arrangement, the firm was to take possession of the property upon the issuance of a cannabis cultivation license from Ventura County. With the firm evidently becoming antsy to complete the acquisition, the transaction is now set to close upon the final building permit issue at the facility being signed off upon instead, introducing a bit of risk in terms of the issuance of the required cannabis license.
Additionally, a $30 million note has been agreed to be carried by the sellers in relation to the purchase, with the note to be carried until the end of the fiscal year, or the issuance of a state cannabis license, whichever is sooner. This enables the transaction to be completed with current cash on hand.
The property itself contains a total of six greenhouse facilities that are said to be approximately 5.5 million square feet in size in aggregate. The company intends to retrofit an initial 1.7 million square feet of the facilities immediately under the first phase, with addition square footage to be retrofitted as the market dictates.
Glass House Brands last traded at $5.14 on the Neo Exchange.
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As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.