Medical Marijuana Inc. Acquiring Startup Valued at Up to $243M

Medical Marijuana Inc. announced Thursday that it has signed an agreement to acquire Kannaway, a startup hemp products company that was recently valued at up to $243 million by a noted investment banking firm.

Financial terms of the deal were not disclosed.

But Medical Marijuana Inc. said that Houlihan Capital pegged Kannaway’s fair market value at between $120 million and $243 million. Houlihan has provided valuation reports and similar services to major companies including US Airways and Urban Outfitters.

The acquisition will likely rank as the largest M&A deal in the history of the medical cannabis and hemp industry, based on the valuation of Kannaway, which was founded less than a year ago.

“If I could have done a backflip, I would have,” Kannaway Chief Executive Officer Jeff Rogers told Marijuana Business Daily when asked about his reaction to the valuation, which was conducted ahead of the acquisition.

The deal is scheduled to close in the next 90 days.

Medical Marijuana Inc. – a San Diego, California-based company that trades on the over-the-counter markets under the symbol MJNA – owns a portfolio of companies that provide hemp and CBD-based products. It is purchasing 100% of Kannaway from General Hemp LLC, which invested seed money in Kannaway to get the company started last year.

Rogers said the deal gives Kannaway “enormous” leverage for expanding into international markets. It already has its products in all 50 U.S. states and territories, including Puerto Rico, and is eyeing markets in Mexico, the Philippines, Brazil, Spain, Korea.

Rogers added that Kannaway – also based in San Diego – is planning on establishing distribution hubs across the United States, with one in Dallas slated to open this weekend.

10 comments on “Medical Marijuana Inc. Acquiring Startup Valued at Up to $243M
  1. Patrick Rea on

    I love to see high valuations for industry companies, but I think most everyone will wait to do “backflips” until the deal is closed. Of note, I’ve never seen an announcement of a valuation opinion like this ever before. Does this news seem odd to anyone else?

    Reply
  2. Brian on

    Never seen such an announcement. With this company, I think all should wait until closed to do anything. They certainly haven’t always walked the straight and narrow.

    Reply
  3. Brian Batrowny on

    with this company, all parties should wait until deal is closed to do anything. They certainly have always walked the straight and narrow.
    I’ve heard of Cannaway/Kannaway- which at one time was a multilevel marketing scheme that involved very low quality cannabidiol, and many people getting sick.

    Reply
  4. Larry on

    I recall the story about a boy who announced he had just sold the family dog for $50,000. He traded it for two $25,000 cats…

    Reply
  5. Graham on

    Congratulations to both companies. This is great progress for the industry and shows how much faith people are placing in marijuana companies. This industry will provide jobs and hope for millions of people. It’s taxable, it actually reduces crime, and much of the revenue is going to education and preventative efforts for youth. It’s a win for everyone.

    Reply
  6. AJ on

    Odd to see the cannabis industry joining the world of investment bankers inflating asset values based on valuations done in a an environment awash with “easing” and “liquidity”. From what I’ve researched on Kannaway, macroeconomic factors have just as much to do with this valuation as the quality of the asset and the associated risks. From the MJNA side, I’d recommend being very skeptical, given the numerous red flags here, not least being the MLM aspect. The operating history is short, the valuation high and the ability of acquisitions to mask other issues is well documented. Empirically, the odds of the acquisition creating significant incremental value aren’t in MJNA shareholder’s favor.
    Disclosure: no position in any cannabis related business

    Reply
  7. eric on

    MLM is here to stay. Get over it. The industry us well over 50 years old. I joined kannaway and I’ve been a very successful real estate investor with over $50,000,000 in real estate transactions. The company’s valuation. ( I’m not a corporate officer) was valued where it is because of its first mover advantage in the market place, it’s patents and it’s products. My guess.

    Reply
  8. arturo flores on

    hola esta es una gran oportunidad de poder cambiar la historia de tu familia y de mi familia ,con este gran product de aceite de cannamo ,visita mi pagina y contactame y yo te puedo explicar como podemos ganar mucho dinero juntos.

    Reply

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