The first cannabis receivership in New England was approved in March, with multi-state operator MariMed purchasing the business operations and assets of Ermot, a vertically integrated medical cannabis operator. Opus Consulting Partners completed the sale.
Approved by the Massachusetts Cannabis Control Commission and the Massachusetts Superior Court, the transaction preserves the Ermont jobs, its cultivation and medical dispensary operations. Opus Consulting, a leading turnaround management and business improvement agency with extensive experience in managing and operating distressed assets in cannabis and other complex industries, serves as the court-appointed receiver for seller Ermont.
“Through the receivership, we were able to streamline Ermont’s operations and procedures, negotiate a restructuring of its debts, maintain jobs, and provide uninterrupted service to medical marijuana patients,” Jacques Santucci, a partner at Opus Consulting, explained in a press release.
The total consideration for the sale transaction was $13 million, in a combination of cash, stock, and debt.
A receivership is a legal mechanism appointed by the court that can serve multiple purposes such as helping creditors to reclaim defaulted funds, aiding struggling companies in avoiding bankruptcy, which is unavailable to cannabis companies due to the federal illegality of the product, and streamlining the process for lenders to retrieve owed funds in case a borrower defaults on a loan.
According to the release, MariMed continues to operate Ermont’s cultivation and medical dispensary operations in Quincy, Massachusetts, and anticipates rebranding the facility as Panacea Wellness. The transaction includes a Host Community Agreement with the city of Quincy to conduct adult-use cannabis sales, which MariMed anticipates commencing upon regulatory approval. While this is the first cannabis receivership transaction to be approved by the Massachusetts CCC, and the first cannabis receivership in New England, others are already underway across the U.S, including several in Michigan.
– Brian Beckley