Cannabis SPAC hires Jay-Z as CVO of new business venture with Caliva and Left Coast Ventures

http://www.billboard.com/articles/columns/hip-hop/7431025/jay-z-releases-police-brutality-philando-castile-alton-sterling

Bethan Rose Jenkins, Cannabis News Writer/Editorial

On November 24, special purpose acquisition company (SPAC) Subversive Capital Acquisition Corp. (SCAC) announced that it had entered into definitive transaction agreements with Shawn “JAY-Z” Carter, Left Coast Ventures, Inc., Roc Nation and CMG Partners Inc. (Caliva) to establish TPCO Holding Corp.

The primary goals of this acquisition are to develop an impactful global cannabis company, as well as consolidate the California cannabis market. No other SPAC company of this magnitude has been formed in Canadian and U.S. cannabis history.

“Although we know we can’t fully redeem the injustices created by the ‘war on drugs’, we can help shape a brighter and inclusive future,” American rapper, songwriter, record producer, and businessman Jay-Z said following the deal’s closing. “The brands we build will pave a new path forward for a legacy rooted in equity, access, and justice. We’re creating something people can trust and we’re investing in our future, our people, and our communities,” added the influential hip-hop artist, who is positioned to become the Parent Company’s Chief Visionary Officer.

“In addition to building the most influential portfolio of cannabis and hemp brands in the world, The Parent Company’s vertical operational platform has been designed for growth and future mergers and acquisitions,” says future CEO of TPCO, Steve Allan. He feels confident that SCAC’s cannabis acquisition will create a path to redefine California’s cannabis industry.

Chairman of the SCAC, Michael Auerbach, describes California as “the most powerful cannabis economy in the world.” He says that the company now has an opportunity to consolidate the market by utilizing TPCO’s “advanced infrastructure, industry leading operational efficiencies, proven strategy of brands, and cultural influence.”

Big name investors jump on-board with SCAC’s cannabis acquisition

The potential of SPAC’s cannabis acquisition has not gone unnoticed, what with investors pouring in from all corners. Examples of the most well-known investors include Roc Nation artists Rihanna, Yo Gotti and Meek Mill. Private placement commitments $36.5 million have been received so far at $10 per share have also been confirmed with Fireman Capital Partners and Tuatara Capital.

Once the transaction has closed, Parent Company TPCO could be in a prime position for success amid “the inevitable end of cannabis prohibition in the United States,” says Auerbach. Although subject to approval from the Neo Exchange Inc., the placement is expected to help fund the growth of SCAC’s cannabis acquisition.

Caliva and Left Coast Ventures are two proven cannabis operators, and California is an incredible market with a huge opportunity for consolidation. I’m proud of FCP’s role and confident that The Parent Company will go on to build industry-leading brands in the cannabis space,” said Partner at Fireman Capital Partners (FCP), Chris Akelman.

SCAC’s cannabis acquisition boasts strong consumer reach and balance sheet 

No other cannabis company in California will have the consumer reach that TPCO is expected to have. As per the proposed business plan, 75 percent of the state’s consumers will have been targeted by the end of next year. By adopting an omnichannel platform that enhances user experiences and promotes better relationships via various points of contact, consumer reach will be on-track to hit 90 percent by the year 2022.

Caliva, which stocks hundreds of cannabis items for free same-day delivery across California, is already successfully serving 50 percent of the state’s consumers with its existing platform. As a state with a legal weed industry that’s expected to be worth $6.59 billion by 2025, Caliva’s involvement in SCAC’s cannabis acquisition is sure to pay off.

Aside from the impressive consumer reach, SCAC also possesses an incredibly strong balance sheet. The company’s data shows that it is sitting on a $575 million cash-in-trust, which means that parent company TPCO is on the assumption that no redemptions are made one of the most well-financed cannabis companies in the U.S.

An investor presentation outlining the SCAC’s cannabis acquisition can be accessed by visiting www.sedar.com or www.subversivecapital.com.