Cannabis consumer packaged goods and brands company Slang Worldwide has announced an agreement to acquire High Fidelity, a vertically-integrated Vermont marijuana company, in a deal worth at least $17.25 million – and perhaps more than $25 million.
The transaction includes $3 million in cash and $12 million in Slang shares at closing, according to a public relations representative for Slang.
A year and a half after the merger closes, Slang will pay a further $250,000 worth of shares and $2 million in cash.
Further, Slang shares worth as much as $8 million may be issued if certain undisclosed performance milestones are met, bringing the potential price tag of the transaction to more than $25 million.
In a news release, Toronto-based Slang said the acquisition would make Vermont the company’s third “core market,” after Colorado and Oregon.
High Fidelity owns two medical cannabis licenses in Vermont, including Champlain Valley Dispensary and Southern Vermont Wellness, which each have two locations.
Both dispensaries recently rebranded as CeresMed. Slang said the company “services approximately 70% of registered patients” in the state.
High Fidelity also owns CBD brand Ceres Natural Remedies, which has three retail stores and branded CBD products.
Vermont legalized adult-use marijuana last October, and sales are expected to begin in October 2022.
“In the upcoming licensing process for adult use, current medical license holders will have early access to the market alongside Vermont’s craft growers, giving them a significant opportunity to build consumer loyalty,” said Slang’s news release.
Slang acquired a Colorado production facility last October.
Shares of Slang trade as SLNG on the Canadian Securities Exchange.