Golden Leaf Holdings, a publicly traded Oregon-based cannabis conglomerate, has just announced that it will be buying Chalice Farms. In an industry where information is often guarded close to the chest, it’s hard to say for sure, but the merged venture will surely be one of Oregon’s largest integrated cannabis companies, if not the biggest.
Golden Leaf Holdings is the parent company behind GoldenXTRX, a popular Oregon-based cartridge, vape pen, and dabble company. They also own Left Coast Connection, a dispensary located out deep on Portland’s NE Glisan, and Proper, a butane and propane extraction company. Chalice Farms is a vertically integrated grower and dispensary chain, recently selected as Oregon’s top marijuana store at the Dope Magazine Oregon Industry Awards.
The deal is not yet done, but the two companies have signed a binding Letter of Agreement indicating that Golden Leaf Holdings will pick up Chalice Farms for a mix of cash, stock, and a share of future sales. Without additional information, it’s impossible to assess what the total value of the deal may eventually be, but the cash component of the sale will leave Golden Leaf holding a bill of about fifteen million dollars.
These days, the exit strategy for most tech start-ups is to find a buyer and cash out. This transaction may be the first indication Oregon’s marijuana companies are heading down the same road. Many industry participants would prefer to avoid a consolidation situation in which smaller market players are overwhelmed by a “Phillip Morris of marijuana”. Indeed, even OLCC licensing guidelines seem crafted to keep the market from being dominated by “big marijuana”. But given the money to be made, we’re willing to bet that the inevitable logic of capitalist accumulation will prevail. Keep your eyes out for more transactions like this one in the future.