Vertical Cos., a vertically integrated medical and recreational marijuana company headquartered in Agoura Hills, will acquire UMBRLA Inc. for nearly $463 million, according to a statement from Vertical.
A letter of intent was signed on Monday for the large-scale merger. After the transaction closes at the end of July, Vertical intends to go public through a reverse merger with a Canadian Stock Exchange-listed company. Vertical declined to name the other company in the merger.
Santa Ana-based UMBRLA is a holding company in the process of consolidating specialized cannabis subsidiaries in California, Oregon, Nevada, Arizona and Oklahoma; the company generated more than $32 million in revenue in 2018.
The two entities are expected to generate $100 million in 2019 and $321 million in 2020, making Vertical one of the largest multi-state operators in the industry, the company said.
“This will be a transformative transaction for our combined businesses. UMBRLA is assembling a terrific group of brands with distribution in more than 700 stores,” said Smoke Wallin, chairman of Vertical. “Combined with our back-of-house seed-to-sale infrastructure investments and large portfolios of unique brands, it makes for a powerful and scaling growth business.”