Orchid Ventures, a California-based, multi-state cannabis brand, has entered into an agreement to purchase assets from GreenBloom Cannabis Co., a vertically integrated cannabis operator with five retail stores, two cultivation facilities, one distribution entity and six brands across Oregon and California.
Per the agreement, Orchid will acquire five of GreenBloom’s retail outlets, as well as two of GreenBloom’s cultivation facilities in Oregon and a cultivation and processing facility that is in development in California. Orchid will also acquire a wholesale and retail facility from GreenBloom, as well as a distribution facility. To cap off the deal, Orchid is also acquiring six of GreenBloom’s cannabis brands.
The total value of the transaction, which was set in motion on July 2, is estimated at more than $29 million.
Orchid, based in Irvine, Calif., launched in California and Oregon in 2017 with its flagship brand, Orchid Essentials. The brand’s vape products have gained a loyal consumer following, according to Orchid CEO Corey Mangold.
“Orchid’s products lines are currently sold in 350-plus dispensaries across California and Oregon and are handcrafted and designed for maximum flavor and overall enjoyment,” Mangold told Cannabis Business Times. “The company’s proven processes and passion for what it does carry through into its products.”
GreenBloom recognized the power of the Orchid brand, which attracted the company to the deal, according to GreenBloom Co-CEO George Mattia.
“My number one thing was Corey and his staff,” Mattia told Cannabis Business Times. “I’ve been carrying Orchid products in my stores since they came to Oregon. I think they’ll be one of the premier brands, if they’re not already. There aren’t really a lot of brands out there in the market nationally, and everyone is still trying to get used to this as we’re still in a new industry. Orchid was recognized. … That’s what made me attracted to it, is their customer loyalty.”
“We’ve proven that if we can be successful in Oregon—a state that’s already gone through price compression and consolidation—we can not only survive in other territories, but flourish.”
-Corey Mangold, CEO, Orchid Ventures
Orchid also shares GreenBloom’s overall goal to build a profitable company and create jobs for local communities.
“We’re after building a real team,” Mattia said. “Our goal is to make sure that every one of our assets is profitable, … [to] have good relationships, and just do good, honest business. That’s one of the main things that attracted me to the Orchid deal.”
The GreenBloom acquisition will allow Orchid to increase its cost of goods sold, streamline its supply chain in California and Oregon, and develop best practices and training protocols to aid in its brand expansion, Mangold said.
“California and Oregon are our home states and will continue to serve as the proving grounds and testing grounds for product and brand development, allowing us insight directly into retail through stores we’re acquiring through this transaction,” Mangold said. “The cultivation facilities are great revenue generators and also allow us to develop and test our own genetics and develop products that are truly differentiated.”
Being forged in the fires of Oregon has made Orchid resilient, Mangold added. “Oregon is a great state to be in because its market is seasoned and it’s highly competitive. We’ve proven that if we can be successful in Oregon—a state that’s already gone through price compression and consolidation—we can not only survive in other territories, but flourish.”
The ultimate goal, Mangold said, is to continue building multiple brands across multiple states—and, eventually, countries—in order to create a global cannabis brand.
Published at Fri, 19 Jul 2019 15:57:00 +0000