Mercer Park Brand Acquisition Corp. and Glass House Group Announce Business Combination to Create the Largest Cannabis Brand-Building Platform in California

April 8, 2021, 5:30 pm EDT

TORONTO, April 08, 2021 (GLOBE NEWSWIRE) — Mercer Park Brand Acquisition Corp. (NEO: BRND.A.U; OTCQX: MRCQF) (“BRND”), a Special Purpose Acquisition Company (SPAC) with the intent to focus on branded product businesses in cannabis and/or cannabis-adjacent industries, has entered into a definitive agreement to acquire Glass House Group (“Glass House” or “GH Group” or the “Company”), a vertically integrated, California-based cannabis company, and all related assets for total consideration of approximately US$567 million.

It is a condition of closing the business combination that the resulting company’s shares will be listed on the NEO Exchange (under the ticker symbol GLAS.U). Subject to the satisfaction of all required conditions, the transaction is expected to close in the first half of 2021.

“When we formed Mercer Park BRND, we aimed to create a platform that could launch the first national cannabis brands in the United States,” said BRND Chairman Jonathan Sandelman. “We view successful cannabis brand-building as a combination of four factors: the ability to control quality biomass at a large scale; produce at the most competitive costs; offer the highest quality products; and deliver the best value proposition to consumers. This took us to California with its ideal growing climate and community of talented and experienced growers, and ultimately to Glass House Group and this incredible portfolio of assets and talent. Glass House has a track record of excellence across all four of these drivers and has established a top ranked flower brand in one of the most competitive cannabis markets in the world. Combined with the proposed combination with the Southern California Greenhouse asset and 17 proposed Element 7 retail licenses, Glass House Group is poised to become the largest, vertically integrated brand-building platform in California, the world’s largest cannabis market.”

Glass House Group Transaction Highlights

Commenting on the acquisition, Glass House’s co-founder and CEO, Kyle Kazan, stated: “We are pleased to partner with the BRND team as we build an even more efficient, expansive platform for our brands. Our inaugural flower brand launch last year was a tremendous success, with our BDS ranking increasing from #63 in the state to #2 by year-end 2020. Further, we have established a strong retail and wholesale network and best-in-class cultivation processes, all anchored by a scaled and highly efficient cost structure. I am incredibly proud of the robust operation we have built over the past five years, and we look forward to augmenting these strengths to further capitalize on the growing statewide and national CPG opportunity.”

Transaction Terms & Financing

Total consideration for all assets in the combination is approximately US$567 million, representing a 2022 revenue and adjusted EBITDA multiple of 1.7x and 5.5x, respectively, and a respective 2023 revenue and adjusted EBITDA multiple of <1.0x and <2.5x. The full consideration amount includes US$325 million for Glass House, US$219 million1 for the Southern California Greenhouse and US$24 million for the 17 Element 7 retail licenses.

BRND shareholders and the management teams of Glass House, Southern California Greenhouse, and Element 7 will roll 100% of their current ownership into Glass House Group stock. Assuming no redemptions and including the US$85 million private placement, the combined company expects to have up to US$355 million of cash available following the closing of these transactions and to remain well-capitalized to fund its long-term growth objectives.

The transactions are expected to close in the first half of 2021, with Glass House founders retaining over 50% of the voting interest.

Following the close of the transactions, Glass House co-founders Kyle Kazan and Graham Farrar are expected to continue to serve as CEO and President, respectively. In addition, the following individuals are expected to constitute the board of directors:


Following the completion of the business combination, Glass House intends to remain focused on driving growth through increasing the penetration of its branded products in owned dispensaries, expanding wholesale distribution throughout California, focusing on higher-margin CPG product line extensions and improving the efficiency and productivity of both its cultivation and in-store operations. Driven by these strategic priorities, the combined company expects to generate full year 2022 revenue and adjusted EBITDA of approximately US$326 million and US$104 million, respectively. In 2023, the company expects growth to continue to approximately US$601 million in revenue and US$240 million in adjusted EBITDA.

This forecast assumes, among other things, the opening and full operation of 21 retail dispensaries by the first quarter of 2022 and the completion of Glass House’s planned cultivation expansion to 2.5 million ft2. in 2023. These initiatives are expected to require approximately US$80-90 million in total capital expenditures to execute in full. In addition, these expectations assume that Glass House’s long-term cultivation facility expansion will be only half complete by 2023.

 US$100M in shares and US$119M in cash, this represents the only use of cash in the qualifying transaction, excluding expenses.

Conference Call

BRND and Glass House management will host a conference call tomorrow, followed by a question and answer session.

Conference Call Date: Friday, April 9, 2021
Time: 8:30 a.m. Eastern time
Toll-free dial-in number: (800) 319-4610
International dial-in number: (604) 638-5340

A presentation highlighting details of the business combination can be found on the BRND website at

The conference call will be broadcast live and available for replay here. A telephonic replay of the conference call will also be available through April 23, 2021.

Toll-free replay number: (855) 669-9658
International replay number: (412) 317-0088
Replay ID: 6547

About Glass House Group
Glass House Group is a rapidly growing, vertically integrated, California-focused organization that strives every day to realize its vision of excellence: compelling cannabis brands, produced sustainably, for the benefit of all. Led by a team of expert operators, proven businesspeople, and passionate plant lovers, it is dedicated to delivering rich cannabis experiences with respect for people, for the environment, and for the community, and an abiding commitment to justice, social equity, and sustainability.

About Mercer Park Brand Acquisition Corp.
Mercer Park Brand (“BRND”) is a special purpose acquisition corporation launched in May 2019 to create the leading branded cannabis company in the U.S. For more information about BRND, please visit the BRND website at

Investor Relations Contact:

Sean Mansouri, CFA or Cody Slach
Gateway Investor Relations
T: (949) 574-3860

Media Contact:

Noah Bethke and Melanie Trecha
MATTIO Communications

Forward-Looking Statements

Certain information in this press release contains “forward looking information” within the meaning of applicable securities laws. Such forward looking information includes, but is not limited to, information with respect to BRND’s and GH Group’s objectives and the strategies to achieve these objectives, as well as information with respect to their beliefs, plans, expectations, anticipations, forecasts, estimates and intentions. This forward-looking information is identified by the use of terms and phrases such as “will”, “may”, “would”, “should”, “could”, “expect”, “intend”, “estimate”, “anticipate”, “plan”, “foresee”, “believe”, or “continue”, the negative of these terms and similar terminology, including references to assumptions, although not all forward-looking information contains these terms and phrases. In particular, and without limiting the generality of the foregoing, forward looking information in this press release includes statements related to: the completion of the proposed transaction between BRND and GH Group, related transaction expenses and level of related share redemptions; the completion and estimated size of the related private placement; the completion and success of the proposed acquisitions of the SoCal Greenhouse and the 17 Element 7 license applications;; GH Group’s business plans and strategies; GH Group’s competitive position; GH Group’s ability to develop products, scale production and distribute products; and the proposed use of BRND’s escrowed funds and proceeds from the proposed private placement. In addition, the financial forecasts and estimates contained in this press release, including forecasted revenue and adjusted EBITDA, constitute “forward looking information” and a “financial outlook” within the meaning of applicable securities laws. Such information is being provided to demonstrate the potential benefits of the proposed transaction and may not be appropriate for other purposes, and should not be relied upon as necessarily being indicative of future financial results. Forward looking information involves known and unknown risks and uncertainties, many of which are beyond our control, that could cause actual results to differ materially from those that are disclosed in or implied by such forward looking information. These risks and uncertainties include, but are not limited to, those described under “Risk Factors” in the prospectus to be filed on SEDAR later this month. Although GH Group and BRND have attempted to identify the main risk factors that could cause actual results to differ materially from those contained in forward looking information, there may be other risk factors not presently known to BRND and GH Group or that they presently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information. Consequently, all of the forward-looking information contained in this press release is qualified by the foregoing cautionary statements, and there can be no guarantee that the results or developments that BRND and GH Group anticipate will be realized or, even if substantially realized, that they will have the expected consequences or effects on our business, financial condition or results of operation.

More detailed assumptions regarding the projections contained herein are anticipated to be described in the prospectus expected to be filed with Canadian securities regulatory authorities later in April, 2021.

Risk Factors

This investment opportunity involves a high degree of risk. You should carefully consider the risks and uncertainties described under “Risk Factors” in the prospectus to be filed on SEDAR later this month. If any of the risks and uncertainties described thereunder actually occur, alone or together with additional risks and uncertainties not currently known to BRND or GH Group, or that they currently do not deem material, BRND’s and GH Group’s business, financial condition, results of operations and prospects may be materially adversely affected. If this were to occur, the value of the offered securities may decline and you may lose all or part of your investment.

No securities commission or similar authority in Canada, the United States or elsewhere has reviewed or in any way passed upon this presentation or the merits of the securities described herein and any representation to the contrary is an offence.

Non-GAAP Measures

This press release makes reference to certain non-U.S. GAAP measures, such as adjusted EBITDA and free cash flow. These measures are not recognized under U.S. GAAP and do not have a standardized meaning prescribed by U.S. GAAP. Rather, these measures are provided as additional information to complement U.S. GAAP measures by providing further understanding of GH Group’s results of operations from management’s perspective. Market participants frequently use non-U.S. GAAP measures in the evaluation of issuers. Adjusted EBITDA is defined as adjusted [for non-recurring, normalizing or one-time items] earnings before interest, taxes, depreciation and amortization, and free cash flow is defined as cash flows related to operating activities less additions to property, plant and equipment and net increase or decrease in finite life intangible assets. GH Group and BRND believe these non-U.S. GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to GH Group’s financial condition, performance and results of operations. GH Group’s management uses these non-GAAP measures for trend analyses and for budgeting and planning purposes. GH Group and BRND believe that the use of these non-U.S. GAAP financial measures provides an additional tool for investors to use in evaluating projected operating results and trends in and in comparing GH Group’s financial measures with other similar companies, many of which present similar non-U.S. GAAP financial measures to investors. Management of GH Group and BRND do not consider these non-U.S, GAAP measures in isolation or as an alternative to financial measures determined in accordance with U.S. GAAP. The principal limitation of these non-U.S. GAAP financial measures is that they exclude significant expenses and income that are required by U.S. GAAP to be recorded in GH Group’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercises of judgments by management about which expense and income are excluded or included in determining these non-U.S. GAAP financial measures. You should review GH Group’s audited financial statements, which will be presented in the prospectus proposed to be filed with Canadian securities regulators in connection with the proposed transaction, and not rely on any single financial measure to evaluate GH Group’s business. A reconciliation of these non-U.S. GAAP measure to U.S. GAAP figures will be included in that prospectus.

Additional Information About the Proposed Business Combination and Where to Find It

In connection with the transaction, BRND is expected to file a prospectus and information circular with Canadian securities regulators. BRND and GH Group urge investors, stockholders and other interested persons to read, when available, the documents (including the prospectus and information circular) expected to be filed with Canadian securities regulatory authorities in connection with the transaction, as these materials will contain important information about BRND, GH Group, the resulting company and the transaction.

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Source: Mercer Park Brand Acquisition Corp.

Released April 8, 2021