Medically Correct Terminates Deal with Denver’s Schwazze
Denver-based edibles and extracts company Medically Correct has terminated its acquisition agreement with fellow Colorado cannabis firm Schwazze.
In a prepared statement, Medically Correct president Bob Eschino said his company notified Schwazze, which is also based in Denver and was formerly known as Medicine Man Technologies Inc., of the decision to rescind an acquisition extension agreement on Monday.
“Our decision to terminate this acquisition comes as we shift our focus toward the development and national expansion of our new brands Quiq, Nove and Clear Creek Extracts,” he said.
Founded in 2010, Medically Correct is Colorado’s “highest-volume” cannabis infused products maker, according to its website. The company owns a range of THC and CBD brands, including the “incredibles” line of chocolates gummies and mints, among others.
In addition to selling throughout Colorado, Medically Correct’s offerings are available in California, Massachusetts, Nevada, Oregon and Puerto Rico. The company is also planning expansions to Arizona, Florida, Michigan, and Ohio, according to its website.
Despite terminating its plans to sell to Schwazze, which last year embarked on an ambitious $170 million Colorado consolidation strategy, Eschino said he hoped to continue working with the company as “an ally in the space.”
“We have great respect for Schwazze and its overall goals, and we look forward to the new opportunities on the horizon for Medically Correct and our brands,” he said.
The proposed purchase, first announced in 2019, marks the fifth major Schwazze deal that’s fallen through in recent months.
At the beginning of July, Schwazze canceled its planned purchases of cannabis cultivator Los Sueños Farms and concentrates company Dabble Extracts. It had planned to spend about $12 million in cash and stock to acquire Los Sueños, and about $3.75 million in cash and stock for Dabble Extracts.
In June, High Country Supply, which owns several recreational cannabis dispensaries under the Colorado Harvest Company banner, terminated its $12.5 million sale to Schwazze. Dispensary group Strawberry Fields also terminated its $31 million sale to Schwazze on April 20, 2020.
Meanwhile, a $118 million deal for 14 Starbuds locations is still pending.
Schwazze, which trades on the OTCQX as SHWZ, has yet to issue a statement or filing acknowledging the cancellation of the Medically Correct transaction.