Canadian medical cannabis industry investor and operator CannaRoyalty Corp. has agreed to acquire two California cannabis companies, part of their expansion strategy into the state. The firm will take over Kaya Management Inc., the exclusive manufacturer and license holder of rights for Bhang brand vaporizer products in California, and Alta Supply Inc, which distributes the brand and about a dozen other cannabis products in the California market.
According to CannaRoyalty CEO Marc Lustig, consolidated sales from Kaya and Alta reached about $9.7 million over the last year.
“With the advent of a full recreational market in California in January 2018, we believe Kaya and Alta are well-positioned to drive further revenue growth,” he said in a press release. “The acquisitions will also give us the right to produce and market one of the most awarded brands in the global cannabis space as well as access to an extensive network of California dispensaries.”
Richard Sellers, CEO of Kaya and Alta, who will join the CannaRoyalty executive team in conjunction with the deals, said that California’s adult-use market is the one “to be a part of in 2018.”
California’s legalized cannabis market is anticipated to reach more than $6.8 billion by 2021, with vaporizer sales expected to represent about 15 percent of that total.
The deals are still subject to customary closing conditions.