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Glass House Brands Completes Acquisition of PLUS, a Leading California Edibles Brand


Chosen by Staff Editors on 05-JUN-22

Glass House Brands Inc.), one of the fastest_ growing, vertically_integrated cannabis companies in the U.S., and Plus Products Inc. ("PLUS") today announced that Glass House has completed the acquisition of the business of PLUS, a leading cannabis edibles company based in California2. The Company acquired PLUS for approximately US$25.6 million3 through a combination of unsecured convertible debt4 and equity, plus additional performance_based consideration.

"With a mission to create the largest cannabis brand_building platform in California, we are thrilled to announce the closing of our PLUS acquisition, positioning Glass House as the only company with a top 5 position in both the Flower and Edibles segments in the California market," said Kyle Kazan, Glass House's Chairman and Chief Executive Officer. "Edibles are a key component of our growth strategy as we further expand our product portfolio and build stronger brand awareness. We are incredibly excited to begin our work with the PLUS team to expand the presence of their premium products in our own retail stores and across our distribution network. The combination of our existing brand platform with PLUS will result in a substantial increase in our Total Addressable Market ("TAM") opportunity in California and, eventually, across the US. The overlap between Glass House Brands' active accounts and those of PLUS was less than 25% in the first quarter, with Glass House being stronger in Southern California and PLUS stronger in Northern California. Additionally, we aim to grow the PLUS brand nationally, which would expand its TAM by roughly 550% versus operating in California alone5."

Mr. Kazan added, "The upside of the current struggle in the California market is that we believe we will find more attractively valued acquisition targets that are win_win propositions for all parties including the consumer. We look forward to entering this new stage of growth by executing on PLUS' and Glass House's shared vision of bringing innovative, high quality cannabis products to consumers."

The Company's house cannabis brand, Glass House Farms, was the No. 1 ranked flower brand by sales in California in Q1 20226. PLUS is a leading edibles brand in California and was the No. 4 ranked edibles brand in California by sales in Q1 20226. Based on top_of_mind brand awareness, a common CPG metric measuring brand strength, PLUS is the No. 1 ranked brand in California in the gummy segment, the largest segment of the edibles category7.

Sources: 1. BDS Analytics
2. Specifically, the Company acquired the US business assets of Plus Products Inc. by merging wholly_owned subsidiary with Plus Products Holdings Inc., a wholly_owned subsidiary of PLUS.
3. Based on the trailing 10_day volume_weighted average price ("VWAP") of Glass House Shares on the NEO prior to the date of execution of the definitive acquisition agreement on December 17, 2021 ($4.08 as of 12/16/21 close). Assuming the full vesting of the 1,794,791 RSUs that will be granted as part of the transaction the total purchase price would be approximately $33m.
4. $20,504,850.96 CAD principal and accrued interest converted at 0.78 CAD:USD
5. Based on BDSA 2026e Cannabis Market size projections for the US (US$46bn) and for California (US$7.1bn).
6. BDSA Retail Sales Tracking
7. Brightfield Consumer Study (N = 1,535 California Edible Consumers)

About PLUS PLUS is a cannabis and hemp food company focused on using nature to bring balance to consumers' lives. PLUS's mission is to make cannabis safe and approachable – that begins with high_quality products that deliver consistent consumer experiences. PLUS is headquartered in San Mateo, CA.

About Glass House Brands Glass House Brands is one of the fastest_growing, vertically integrated cannabis companies in the U.S., with a dedicated focus on the California market and building leading, lasting brands to serve consumers across all segments. From its greenhouse cultivation operations to its manufacturing practices, from brand_building to retailing, the company's efforts are rooted in the respect for people, the environment, and the community that co_founders Kyle Kazan, Chairman and Chief Executive Officer, and Graham Farrar, Board Member and President, instilled at the outset. Through its portfolio of brands, which includes Glass House Farms, Forbidden Flowers, and Mama Sue Wellness, Glass House Brands is committed to realizing its vision of excellence: outstanding cannabis products, produced sustainably, for the benefit of all. For more information and company updates, visit www.glasshousebrands.com and https://ir.glasshousebrands.com/contact/email_alerts/.


Glass House Brands

Related URL:https://www.glasshousebrands.com


This article is from the Edibles basket.
(Important there are many baskets: Basketball, Basketcase, Basket the Magnificant, Utility Basket, A Woven Basket ... in our case a basket is just a basket. Go Figure!)


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