Canadian cannabis producer Tilray spent $165.8 million on acquiring the majority of Medmens' outstanding secured convertible notes from Gotham Green Partners and 65% of its outstanding warrants. Once converted into stock, Tilray will have a minority stake in Medmen - that is to say, if U.S. legalization happens.
With this acquisition, Tilray says to have a path into the U.S. Market.
Irwin D. Simon, Tilray’s chairman and CEO, who earlier this year reverse merged his former company Aphria with Tilray, said Tilray is still looking at more deals to get the new company to $4 billion in revenue by 2024. “Backed by accelerating trends towards legalization globally, we are focused on building the world's leading cannabis-focused consumer branded company with a goal of $4 billion of revenue by the end of our fiscal 2024. The investment we are announcing in MedMen securities today, one of the most recognized brands in the $80 billion U.S. cannabis market, is a critical step towards delivering on our objective as we work to enable Tilray to lead the U.S. market when legalization allows.”
MedMen is a cannabis retail brand in the U.S., holding 21 licenses and 25 retail locations across key urban centers, including the Bay Area, Los Angeles, Boston, Chicago and Las Vegas, and a significant position in California, the world’s largest market. Prior to U.S. federal legalization of cannabis, and subject to compliance with applicable laws and stock exchange rules, MedMen will actively explore opportunities to expand MedMen’s footprint across international markets.
Tom Lynch, MedMen’s chairman and CEO, added, “Our management team has spent the past 18 months executing a disciplined turnaround plan. We are grateful to our stakeholders for their patience and support as we worked to fix the business and rebuild trust and credibility. We believe that patience has paid off, as these efforts have succeeded in attracting partners who share our vision for building the world’s most powerful cannabis retail brand. In addition, the proceeds from the private placement and amendments to the notes, gives MedMen the cash and flexibility to match our revenue trajectory to our operational expertise and internationally renowned brand. MedMen 2.0 is here, and we are thrilled to embark on the next stage of our journey.”
In connection with the sale of the notes, MedMen and GGP amended the restrictive covenants and extended the debt maturity to 2028 to provide MedMen the flexibility to execute on its growth priorities and explore additional strategic opportunities. In addition, MedMen has separately announced a significant equity investment from a private placement of MedMen Shares (as defined below) and warrants to a group of investors.
Conversion of the stake is subject to regulatory approvals, U.S. legalization and other factors. 
For more information:
www.tilray.com