Demand Brands, Inc. (OTC:DMAN) has completed the acquisition of CF3 SPV I, LLC, in an all-stock transaction. CF3’s unitholders will receive convertible Series E Preferred shares that will be valued between USD $250 to $550 million, subject to an audit and valuation being prepared by Stanton Park Advisors LLC. CF3 currently generates more than $28 million in annual revenue at its current run rate.
“CF3’s seed-to-sale platform allows the company to capture the entire value chain of the cannabis market,” stated Andrew Colehower, incoming CEO. “CF3’s highly efficient cultivation and supply line management paired with its patented microbial solutions allow the company to create products including flowers, concentrates and distillates with THC content exceeding 30%. We are excited about the value this transaction creates for the company.”
The acquisition provides the company with a portfolio of 11 managed licenses in California with access to 236,000 SF of cultivation space and 41,500 lbs. of cannabis cultivation and processing. CF3 has established cultivation facilities on the Central Coast of California and distribution contracts throughout the state.
The acquisition provides a footprint for the company to expand to 111,000 lbs. of cannabis cultivation and processing by 2026.
CF3 offers well-known lifestyle brands strategic advice and consulting services to enter the cannabis sector to leverage their brand equity to capture additional revenue. The company plans to build a footprint across the continent by offering consulting services to small and medium cannabis enterprises.
CF3 is in the process of transitioning to a farm-direct model to distribute 35,000 lbs. of product this year and next through the company’s trading desk.
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