Cansortium Inc. (OTC:CNTMF), a multi-state cannabis operator under the FLUENT brand and RIV Capital Inc. (OTC:CNPOF) announced a merger that will operate in Florida, New York, Texas, and Pennsylvania, covering 25% of the U.S. population with eight cultivation and processing facilities and 42 retail dispensaries.
Supported by ScottsMiracle-Gro’s $175 million debt elimination, the merger combines Cansortium’s operational expertise with RIV Capital’s $66 million cash reserve. But how will this consolidation impact stakeholders and the cannabis market in these key states?
Financial Position And Growth Opportunities
The combined company is expected to have a pro forma cash balance of $74 million as of March 31, 2024. This will enable the company to fund growth opportunities, including the New York market. The merger is projected to generate $5-10 million in annual cost synergies through operational efficiencies and corporate integration.
Cansortium reported 2023 pro forma revenue of $105 million and an adjusted EBITDA of $27 million.
Support From ScottsMiracle-Gro
The merger garnered support from ScottsMiracle-Gro (NYSE:SMG), which plans to exchange its convertible notes in RIV Capital for non-voting shares of Cansortium, eliminating $175 million in debt. The move will strengthen the new company’s balance sheet, which will operate under the Cansortium name and be headquartered in Tampa,
