MedMen and PharmaCann announced Tuesday they will end a merger agreement that would have solidified MedMen’s position as one of the largest multi-state operators in the United States.
The termination of the deal, which was signed in December 2018, comes after a year of several major mergers and acquisitions announcements within the cannabis industry such as Canopy Growth’s $3.4 billion acquisition of Acreage Holdings, Cresco Labs’ $823.5 million acquisition of Origin House, and Harvest Health and Recreation’s $850 million acquisition of Verano Holdings. The Canopy acquisition will only go into full effect once cannabis is federally legal in the US, and both the Cresco and Harvest deals await approval from the Federal Trade Commission and the Department of Justice under the Hart-Scott-Rodino Antitrust Improvements Act.
MedMen pointed to several factors for the decision: a desire to focus on California, the biggest market in the US and one in which the company has a significant presence; the “underperformance” of cannabis stocks in the US and Canada this year; and delays caused by “regulatory hurdles at the federal and state level.”
