Entertainment and tech entrepreneur Scooter Braun is entering the cannabis business.
Braun’s Ceres Acquisition Corp. and Toronto-based Parallel, one of the world’s largest privately held multi-state cannabis companies, have entered into a “business combination” to launch a publicly traded U.S. cannabis “well-being” company. The new company will be listed on the Canadian NEO stock exchange.
“It’s not often that you get to participate in the early stage of a new industry and be in the unique first-mover position with the opportunity to shape the future,” said Braun, a co-founder of Ceres Acquisition, who will serve as a special advisor to the new company. “I missed out on the dot-com bubble of the late ‘90s that some of my mentors were a part of and this is our moment to create generational wealth. The cannabis industry is poised to be the most influential emerging industry of my lifetime. I don’t want to look back and regret not getting to be part of a dynamic and prominent space. FOMO is real.”
Ceres Acquisition is a special purpose acquisition corporation (SPAC) designed to raise money in an IPO, then have two years to acquire the business.
Ceres Acquisition Chairman/CEO Joe Crouthers will become a director of the combined public company, with the addition of four independent directors with significant health and life sciences experience.
“Ceres’ deep cannabis and consumer experience, coupled with Scooter’s powerful network, makes Ceres an ideal partner for a well-positioned, well-led, high growth cannabis company like Parallel,” added Crouthers.
William “Beau” Wrigley, Jr., former Chairman/CEO of the fabled global gum and confections company, will remain as Chairman and CEO of the combined entity. Wrigley was sold to the Mars company in 2008 for $23 billion.
Said Wrigley, Jr., “As a public company, we will have access to capital to grow our national footprint through new licenses and M&A, improve our cultivation and production capacity, expand our established retail footprint, develop and launch rare cannabinoids products with therapeutic benefits, and conduct important clinical research in partnership with the University of Pittsburgh Medical Center.”
The transaction is expected to fuel the growth of Parallel’s U.S. footprint and enhance its mission to pioneer well-being and improve quality of life through cannabinoids.
Parallel already has operations in five states, including Florida, Pennsylvania, Massachusetts, Texas and Nevada, with a total of 42 brick-and-mortar dispensaries and an e-commerce infrastructure, including online orders, curbside pickup and home delivery
The transaction values Parallel at a value of U.S. $1.884 billion. The combined companies are expected to have $430 million cash balance at the closing of the deal and is expected to generate $447 million in revenue in 2021.