CannaRoyalty Corp. d/b/a Origin House, a North American cannabis products and brands company today announced that it has closed the previously announced acquisition of Cub City LLC (“Cub City”), a licensed premium craft cannabis producer based in Sonoma County, California for total consideration of US$5.3 million (the “Acquisition”).
“Access to bespoke cannabis production capacity and related expertise is valuable not just to new cannabis brands but also to heritage, established brands. The addition of Cub City to our cultivation roster strengthens our infrastructure and team in California, making us the partner of choice for brands across the spectrum,” commented Marc Lustig, Chairman and CEO of Origin House.
- Cub City’s 24,600 sq. ft. Santa Rosa facility has an annual production capacity of up to 1,400 kg of ultra-premium flower, along with pre-roll production capabilities.
- As previously disclosed, Cub City holds a provisional state indoor cultivation license and a local minor-use permit for cultivation, non-volatile manufacturing, processing and distribution.
- Currently undergoing improvements and upgrades, the Cub City facility is expected to be operational in July 2019.
- Flower-based products comprise a major segment of the total cannabis market in California. In 2018, flower made up US$974 million, and pre-rolls made up US$1941 million of all cannabis sales in the state. With the Acquisition, Origin House further solidifies its position in the flower market, including the ultra-premium segment targeted by Cub City.
- The Acquisition strengthens Origin House’s cultivation capabilities through a licensed facility and a skilled production team that has experience cultivating for some of the top craft flower brands in California. Joining the Company under the supervision of Origin House employees Drew and Karen Duval, the team will leverage its expertise and Cub City’s proprietary production techniques to produce ultra-premium offerings for the Company’s current and prospective brand partners.