KushCo and Greenlane Kick Off Proxy Solicitation Process and Move One Step Closer Toward Completing Mega-Merger

·2 min read

In a move that will result in the creation of the leading ancillary cannabis company and house of brands, KushCo Holdings, Inc. (OTCQX: KSHB) and Greenlane Holdings, Inc. (NASDAQ: GNLN) have announced an all-stock merger agreement.

The transaction was approved unanimously by the boards of directors for both Greenlane and KushCo, recommending that stockholders approve the transaction. The deal is expected to close in the third quarter of 2021, subject to the requisite stockholder approvals.

The merger comes at an important inflection point in the cannabis industry, as the biggest operators consolidate the sector, new states legalize adult recreational cannabis use, and the industry as a whole moves closer to full federal legalization, which has never seemed more likely to occur as it does today. On June 29, 2021, New Mexico became the latest state to make adult recreational cannabis use legal in the state. New York also recently approved recreational legalization, along with Virginia and Connecticut, bringing the total to 19 states that have legalized adult recreational use and nearly 40 that have legalized medical use.
The merger would allow the two companies to cross-sell complementary products and services to their respective customer bases, marrying Greenlane’s proprietary owned brands and leading B2C presence with KushCo’s deep B2B relationships with the top multi-state operators (“MSOs”). In addition to these revenue synergies, the merger is expected to generate between approximately $15 - $20 million in annual cost saving synergies within 24 months of closing, and create one of the few opportunities for investors to invest in the fast-growing U.S. cannabis industry with Greenlane’s Nasdaq listing.

KushCo’s co-founder and CEO Nick Kovacevich will become CEO of the combined company, while Greenlane’s CFO Bill Mote will serve as CFO for the combined company.
The companies recently announced the start of their proxy solicitation process, which will lead up to their respective stockholder meetings to approve the merger, both scheduled to occur on August 26, 2021.

The definitive joint proxy statement/prospectus was first mailed to stockholders of both companies on or about July 6, 2021. Stockholders of both companies are encouraged to vote their shares early, and to reach out to the applicable proxy solicitor (D.F. King for Greenlane, and Morrow Sodali for KushCo) with any questions or if they need assistance in voting their shares. For more information, you can view the July 6 press release here.
Greenlane and KushCo have also announced the launch of www.greenlanekushcotogether.com, a dedicated transaction website consolidating publicly available information on the transaction for investors of both companies, including messages from both CEOs as well as a helpful section addressing frequently asked questions.

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