Boston-based Ascend Wellness began trading ($AAWH) on the Canadian Securities Exchange yesterday, and Forbes is calling it “the most anticipated cannabis IPO of the year” (although they also note the IPO was just announced in April).
The strategy
Underwritten by Cannaccord Genuity, ATB Capital Markets, Beacon Securities Limited, Cormark Securities and Eight Capital, Insider says that unlike American cannabis predecessors, Ascend went the more laborious and time-consuming IPO route as opposed to an RTO or SPAC to attract “top-tier” investors.
“The RTO is a lower disclosure way of going public,” CEO Abner Kurtin told Insider, explaining that institutional investors want transparency and governance. “It’s kind of an out-of-date, early-stage way of going public — I don’t think it makes sense anymore.”
The plan
Valued at US$295.9 million pre-IPO, Ascend raised US$80 million with shares priced at $8. The funds will allow the MSO to make acquisitions and grow beyond the five legal states it’s currently operating in: Illinois, Michigan, Massachusetts, New Jersey and Ohio.
Aiming high
Kurtin said the deal will also allow Ascend to remain a US company, which he aims to eventually bring to the NASDAQ as soon as it’s allowed at the federal level. (Until then, they’ll stick it out on the CSE – affectionately known as the Cannabis Securities Exchange.)
“We expect to be among the very first companies to up-list,” he told Insider. “And we think that’s a huge advantage over a number of our competitors. We’ve spent the time and money, and we’ve done the work to be in that position.”
