The breakneck pace of completed mergers and acquisitions in the marijuana sector could be coming to an finish.
Deal activity was down considerably in September versus a year ago – only 16 this year compared with 29 in 2018.
The quantity of offers in the very first nine months of 2019, nonetheless, was nonetheless ahead of 2018 – 278 versus 242.
Cultivation and retail remained the prime mover behind M&A activity in September.
This month-to-month series from Marijuana Company Everyday and Viridian Capital Advisors supplies the most recent information on cannabis investment activity and M&A, along with essential takeaways, evaluation and trends primarily based on current marketplace moves.
The information beneath is by way of the week ended Oct. four.
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Total volume of raises slows in September
Even though the quantity of raises in September 2019 was up more than the exact same month in 2018 – 53 capital raises versus 43 – the total quantity raised was basically down.
In September 2018, the typical raise was $14.7 million for an all round total of $630.four million. This year, September’s typical was $11.three million for an all round figure of $599.1 million.
That is a diverse profile from the earlier month, when the typical size of each and every raise was almost triple the earlier year’s quantity, resulting in an all round total of $972.eight million raised versus $369.three million in August 2018.
Cultivation and retail dominates even in slower M&A infused solutions sturdy
As noted, cultivation and retail continued to be the driving force behind completed M&A offers this previous month even as the all round volume slowed.
Specifically half the closed offers in September involved purchasers in that sector.
This is broadly in line with the trend for the very first nine months of 2019, when 131 purchasers in cultivation and retail have been accountable for a total of 278 closed offers.
The infused solutions and extracts segment accounted for 5 of the 16 completed M&A offers in September 2019.
Viridian Capital Advisors is a economic and strategic advisory firm that supplies investment banking, M&A, corporate improvement and investor relations solutions to emerging development businesses and certified investors in the cannabis sector.