Boston’s 4Front Ventures Looking Forward to Cannex Merger
In a high-profile deal expected to close by February, Boston-based 4Front Ventures will merge with Vancouver-based Cannnex Capital Holdings Inc., which operates under the name Northwest Cannabis Solutions, for $450 million in stock.
Cannex (OTC: CNXXF) agreed to issue stock in a way that gives majority control of the combined company to 4Front, which will become a public company once the stock sells on the Canadian Stock Exchange (CSE). The transaction entails 4Front being granted shares of Cannex that will be issued next year at a rate of 1.75 of 4Front shares for every one share of Cannex. Based on the value of comparable stocks already traded on the CSE, the shares should sell as long as they’re offered at an attractive price.
Cannex shareholders are expected to vote by the end of February on the proposal to issue more stock, marking the close of the transaction.
“The synergies are perfect,” 4Front president and co-founder Kris Krane tells Freedom Leaf. “Cannex will take over cultivation and production—that’s their competency. That’s the hardest part. Our expertise is in retail sales and capital markets. The pieces fit perfectly.”