High Times Purchases Spain’s Spannabis for $7 Million in Cash and Stock, Plus Milestone Payments
The parent of High Times magazine has purchased Spain’s Spannabis for $7 million in cash and stock, adding Europe’s largest marijuana industry event to its growing conference portfolio.
Spannabis’s parent company, Feria Del Canamo, S.L., will host its 16th annual event in Barcelona this March, when it expects to draw tens of thousands of visitors.
“We believe that High Times is the most recognizable brand in Cannabis across the world. You can see our logo proudly displayed from New York to Singapore and we look forward to creating more access and experiences for consumers no matter where they live,” said Hightimes CEO Adam Levin. “Spannabis is one of the most prolific events in the cannabis ecosystem, and one of the most well-known annual festivals within the EU.”
The deal includes $3 million of cash, $4 million of Hightimes common stock, and two milestone payments in 2020 and 2021.
The deal is the latest in a string of acquisitions by Hightimes Holding Corp., which is raising up to $50 million in a Regulation A+ IPO open to all investors until the end of January. The complete offering details are available at the company’s investing portal here. The company plans to use the IPO proceeds to invest in growth across both existing and new business platforms.
Hightimes recently gained even more buying power after reducing the debt on its balance sheet dramatically through a conversion and warrant exercise late last year.
Hightimes operates the renowned Cannabis Cup events along with Reggae On The River and the High Times Business Expo. The company also recently acquired DOPE Media for $11.2 million. DOPE has regional publications along with Dope Cup events that complement Cannabis Cup events. In December, Hightimes bought Buyers Industry Guide, owner of the BIG Show industry conferences. The B2B tradeshows gather twice annually in Miami and Los Angeles with over 10,000 industry guests annually.
A conference rollup strategy is smart for High Times on multiple counts. First, can use its existing sales infrastructure across events, reducing costs. The High Times brand is also stronger than any other in the industry, so more attendees may take interest in the events with the new affiliation.
High Times has several other growth engines beyond conferences. For instance, until current management took over, the company had neglected to pursue a serious digital strategy. The company’s plans include the recent launch of an over-the-top streaming service that’s akin to a Netflix of cannabis, reflecting a fresh push to monetize the High Times brand.
The cannabis industry has drawn attention from investors and blue-chip companies in recent months as legalization in more U.S. states creates growth opportunities. Big Tobacco leader Altria recently announced a $1.8 billion investment in Cronos Group in December. Also, beer company Constellation Brands recently increased its stake in Canopy Growth with a $3.8 billion investment in the Canadian cannabis grower, a deal that surprised investors.
Once public, High Times will join other listed, growth-stage companies focused on the burgeoning cannabis industry. Those include MassRoots, which operates a mobile app for marijuana consumers to share and compare reviews. Another is KushCo Holdings, which offers products to marijuana dispensaries and growers. Most recently, Level Brands acquired CBD manufacturer cbdMD as the Farm Bill removed hemp from DEA oversight, clearing a path for broader CBD sales.
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