The Green Organic Dutchman (TSX: TGOD) is looking to spin out its European hemp operations. The company this morning revealed in a strategic update that it is in the process of pursuing strategic options for the subsidiary.
TGOD has reportedly retained Canaccord Genuity for the process, with the firm currently examining whether a potential sale or spin-off for an IPO is most appropriate for the asset. Canaccord has reportedly been engaged as well for potential M&A activity in the space.
The spin-out of the firms hemp operations would be notable for the company. The division last year accounted for roughly 36% of the firms revenues, or $8.8 million of the total $24.5 million in revenues reported. In prior years, that percentage of revenue was even higher with the division accounting for 89% of revenues in 2019.
Outside of the hemp transaction, the company has reportedly closed the first round of bidding for its Valleyfield facility, with a number of suitable bids reportedly provided.
The company also revealed that it is “gearing towards US entry,” however the company will be limited in what operations it can acquire in the space due to the exchange in which it is listed on. For this, the company is considering a potential listing on the CSE to enable it to acquire US cannabis operations, which would make it one of the first such firms to leave the TSX for the CSE. The company is currently exploring strategic options for a US entry, including potential M&A activity.
The Green Organic Dutchman last traded at $0.31 on the TSX.
Information for this briefing was found via Sedar and The Green Organic Dutchman. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
