WM Holding Company, LLC, which operates online cannabis shop directory Weedmaps, and Silver Spike Acquisition Corp. (SSPK), a publicly-traded special purpose acquisition company, said Thursday they have agreed for a business combination that would result in WM Holding becoming a public company. Shares of Silver Spike are gaining almost 24 percent following the news.
The combined company will be led by Chris Beals, Chief Executive Officer of WMH, and is expected to remain listed on the Nasdaq Stock Market.
The estimated post transaction equity value of the combined company is about $1.5 billion, assuming the $10.00 per share PIPE price and no redemptions by Silver Spike shareholders.
The transaction will provide up to $575 million of gross proceeds through the approximately $250 million of cash held-in-trust by Silver Spike Acquisition Corp. and a fully-committed common stock PIPE of $325 million.
The PIPE includes commitments from existing investors including Silver Spike Capital, and new institutional investors including funds managed by AFV Partners, the Federated Hermes Kaufmann Funds and Senvest Management LLC.
WM Holding’s executive officers will retain 100 percent of their equity in the combined company, which will have about $100 million of cash on hand after closing.
Founded in 2008, WMH operates Weedmaps, an online listings marketplace for cannabis consumers and businesses, and WM Business, the most comprehensive SaaS subscription offering sold to cannabis retailers and brands.
Weedmaps has over 10 million monthly active users and over 18,000 business listings across every U.S. state, the District of Columbia and Puerto Rico with a legal cannabis market.
The cannabis market in the U.S. is expected to double over the next five years as the majority of U.S. adults support having legal access to cannabis.
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