Parallel Enters Deal with SPAC, Eyes on Going Public

Parallel, the cannabis company owned by William “Beau” Wrigley, Jr., the former chairman and CEO of the candy company that shares his name, has entered into an agreement with special purpose acquisition company (SPAC) Ceres Acquisition Corp that would see the combined company go public.

Wrigley, who will remain the company’s chairman and CEO, with Ceres Group co-founder Scooter Braun serving as special advisor, and Ceres Acquisition Corp. Chairman and CEO Joe Crouthers, serving as a company director.

“As a public company, we will have access to capital to grow our national footprint through new licenses and M&A, improve our cultivation and production capacity, expand our established retail footprint, develop and launch rare cannabinoids products with therapeutic benefits, and conduct important clinical research in partnership with the University of Pittsburgh School of Medicine. We look forward to working with the Ceres team and benefiting from Scooter Braun’s expertise and extensive influencer network to reach our diverse consumers with creative omnichannel approaches that will fuel Parallel’s leadership in the cannabis industry.” – Wrigley in a statement

The deal sets Parallel’s implied enterprise value at $1.884 billion, and Ceres has received commitments from a group of investors in an over-subscribed [Private Investment in Public Equity] of $225 million at a price of $10.00 per share issuable immediately prior to, and conditional on, completion of the deal. Parallel estimates net revenues of  $447 million this year, pro forma cash on hand of $430 million at close, including US$225 million from the PIPE, and $120 million in cash held in Ceres’ escrow account assuming no redemptions.

The combined publicly listed company is anticipated to have Class A Subordinate Voting Stock and Class B Multiple Voting Stock, the companies said. The Class B Multiple Voting Stock will have 15 votes per share and will be held by Wrigley and his affiliate entities upon the transaction’s close.

Other members of the proposed company’s board of directors include Marina Bozilenko, Strategic Advisor to William Blair and Company; Kevin Douglas, M.D., who currently serves as medical director of U.S. Rheumatology and Study Designated Physician/Therapeutic medical director at Abbvie, Inc.; Sarah Hassan, who was a founding partner of IM HealthScience; Linda McGoldrick, who has served as CEO and independent board member of several healthcare and life sciences companies; and Parallel’s General Counsel Phil Harris.

Parallel operates in Florida, Pennsylvania, Massachusetts, Texas, and Nevada.

The deal is expected to close this summer.