Multistate cannabis operator MedMen is ending 2023 with a number of changes, specifically pertaining to its stores in the Southwest portion of the country.
On Dec. 20, MedMen announced that it had entered definitive agreements to sell its non-core business operations in Arizona along with certain assets in Nevada. On the other side of the transactions is MINT Cannabis, a privately held multistate cannabis operator, headquartered in Arizona.
The deal involves the sale of MedMen’s wholly-owned operating subsidiary in Arizona and its two operating dispensaries in Clark County, Nevada. According to the news release, the sales came as a result of MedMen’s strategic review and evaluation of divestiture opportunities of its non-core assets, which were announced prior to these transactions.
MedMen CEO Ellen Deutsch Harrison spoke out favorably in reference to the decision.
“MedMen is pleased with the outcome of our strategic review and has made good progress in our restructuring efforts,” Deutsch Harrison said. “These transactions will bolster liquidity in the short term, reduce liabilities, and enable the Company to focus on operating efficiencies and executing our long-term asset-light growth strategy in our core markets.”
Similarly, MINT Cannabis Co-founder and CEO Eivan Shahara referenced the move as a positive, namely in that it will allow the company to continue growing.
“We are excited to expand our portfolio of flagship dispensaries through the acquisition of MedMen’s Scottsdale Talking Stick Dispensary and Mesa Cultivation Facility, along with establishing our vertical presence in Nevada through the addition of two premium Las Vegas Dispensaries,” Shahara said. “MINT Cannabis is pleased to have reached an agreement with MedMen and has strong ambitions to continue to build our footprint through both organic and strategic growth across various key markets in the US.”
The value of the transaction has not been disclosed.
Over the years, MedMen has grown to become one of the most well-known cannabis companies in the U.S. Founded back in 2010 and headquartered in California, the company has an operational footprint in California, Illinois, Massachusetts and New York—following these transactions.
While the company has stood as an industry giant throughout the years, MedMen started the year with an announcement to warn investors that it was running out of money and may not have enough to “meet its obligations” over the next year, referencing questions surrounding its ability to stay in business.
The strategic review of assets was announced in February 2023 as well, including a review of assets in Illinois (two dispensaries) alongside those in Arizona and Nevada. ATB Capital Markets Inc. was enlisted to assist in the strategic review and potential sale of the assets, meant to help MedMen evaluate opportunities to divest certain retail and cultivation assets to “bolster liquidity and maximize shareholder value with an asset-light model,” according to a press release shared at the time.
Last month, MedMen also notified stock regulators that it would be late in filing its third quarter financial reports for the three-month period ending Sept. 30, referencing that the report would be in by Dec. 13, though the quarterly report still hadn’t been filed at the time of the transaction. The British Columbia Securities Commission also issued MedMen a management cease trade order due to the delay on Nov. 1.
According to the company’s last release of quarterly earnings back in May, reflecting its third quarter fiscal 2023 results for the three-month period ending March 25, MedMen had a working capital deficit of $383 million and $7.6 million in cash on hand.
In 2022, MedMen sold off its Florida-based operations after its co-founders Andrew Modlin and Adam Bierman stepped down from their roles on the company’s board of directors over unpaid loans.
