DENVER, Sept. 13, 2021 /PRNewswire/ -- Akerna
(Nasdaq: KERN), an enterprise software, leading compliance
technology provider, and developer of the cannabis industry's first
seed-to-sale enterprise resource planning (ERP) software technology
(MJ Platform®), announced it has signed an agreement to acquire 365
Cannabis, a cannabis business management software system built on
Microsoft's Dynamics 365 Business Central in a $17 million deal at 2.1x LTM revenue. The
combined key capabilities of the acquisition are listed at the
bottom of this announcement.
Akerna will host a conference call tomorrow, Tuesday, 9/14, at
8:00 a.m. Eastern Time to discuss the
acquisition
Akerna will host a conference call tomorrow, Tuesday, September 14, 2021, at 8:00 a.m. Eastern Time to discuss the
acquisition.
A question-and-answer session will follow prepared remarks.
Interested parties may listen to the call by dialing:
- Toll-Free: 1-877-407-3982
- Toll / International: +1-201-493-6780
- Conference ID: 13722555
An updated investor deck on the transaction
will be made available at: ir.akerna.com.
As a result of the acquisition, 365 Cannabis' 85+ clients will
gain access to Akerna's Compliance Gateway, feature-rich reporting,
MJ Retail POS, and the recently launched Akerna Connect. Akerna has
partnered with SAP, Sage Intacct, and other leading providers for
integrated financials and tax planning, offering cannabis operators
a solution for each stage of their evolution – from startup to
multistate operator (MSO) – while maintaining regulatory compliance
every step of the way through Akerna's Compliance Gateway. The
acquisition of 365 Cannabis accelerates the deployment of this
strategy with the addition of Microsoft capabilities, further
establishing Akerna as the most robust cannabis-compliant ERP
system offering a full portfolio of mainstream tax and
financials.
Over the past few years, there has been a substantial positive
change in the political and social climate surrounding the cannabis
industry, which has seen continued growth in revenue, new markets,
and consumers. As new markets are added and the possibility of US
federal reform increases, cannabis operators in existing markets
are looking to expand their operations and become successful MSOs
by opening or seeking to open operations in new states. To become a
successful MSO, these businesses require a comprehensive ERP system
that can scale with them as they grow from startup to enterprise
while simultaneously meeting multistate compliance.
"By adding 365 Cannabis into our Akerna ecosystem, we will
continue to create new standards and best practices around
compliance in every state, province, and country across the globe,
standardize how the global supply chain is managed, and forge best
practices in technology and hosting," says Jessica Billingsley, Chief Executive Officer of
Akerna. "The synergies between our two companies' products and
offerings will finally create all in one for the entire cannabis
industry, on a global scale."
"As we combine our leading solutions built specifically for the
ever-evolving cannabis industry, along with Akerna's 80+
integrations through open APIs, we can now offer cannabis operators
a full suite of products to optimize their businesses, improve
overall functionality, and ultimately increase sales," says
Jeff Kiehn, Chief Executive Officer
of 365 Cannabis. "With the combined team of over 200+ skilled
employees including 30 + years of consulting experience, coupled
with an unrivaled true ERP system and supporting technologies, our
goal is to modernize and propel the cannabis industry throughout
this rapid growth period and beyond."
Cannabis 365 clients include Pharmacann, Nectar, Revolution,
Sundial, Kiaro, and many others.
As the cannabis industry prepares for a post-legalization
landscape, Akerna is strengthening its channel connections with
existing ERP providers, firmly solidifying its strategic moat as
the most comprehensive ERP solutions provider for the industry.
Businesses employ ERP solutions to manage their functions in a
centralized system, bringing business intelligence and data,
compliance and risk management, customer management, inventory,
finance, operations, and supply chain information together. By
using ERP products, organizations can scale, save money, and
improve productivity all within one tool. Many cannabis technology
solutions use the letters ERP but lack the full suite of
offerings.
The deal will be paid with $4
million in cash and $13
million stock with a potential earnout of $8 million. The acquisition is expected to close
in Q4 and is subject to customary closing conditions.
The combined complementary key capabilities of Akerna and 365
Cannabis will:
- Enable Akerna to deliver the broadest portfolio of ERP
solutions for cannabis operators, covering access to a majority of
the mainstream mid-market financial and tax planning market while
establishing Akerna as the most robust cannabis-compliant Microsoft
offering
- Offer cannabis operators a financial and tax planning system
for each stage of their growth while realizing combined scaled
synergies by maintaining regulatory compliance every step of the
way through Akerna's Compliance Gateway
- Give 365 Cannabis' 85+ customers access to Akerna's compliance
gateway and ecosystem, including Akerna's retail and analytics
capabilities
About Akerna
Akerna (Nasdaq: KERN) is an enterprise software company focused
on compliantly serving the cannabis, hemp, and CBD industries.
Based in Denver, Colorado, the
Company's mission is to create the world's most transparent and
accountable supply chain by building a cannabis technology
ecosystem connecting data points across the global cannabis supply
chain from seed to sale to self. First launched in 2010, Akerna has
tracked more than $20 billion in
cannabis sales to date and was the first cannabis software company
listed on Nasdaq.
Using connected data and information to propel the cannabis
industry forward, Akerna empowers businesses, governments,
patients, and consumers to make smart decisions. The Company's
cornerstone technology, MJ Platform, the world's leading
infrastructure as a service platform, powers retailers,
manufacturers, brands, distributors, and cultivators. Akerna also
offers a complete suite of professional consulting services and
data analytics for businesses as well as solo sciences, MJ Freeway,
Leaf Data Systems, Trellis, Ample Organics and Viridian
Sciences.
About 365 Cannabis
365 Cannabis is a comprehensive vertically integrated cannabis
software solution built on the Microsoft Dynamics platform. The
company is a Microsoft Gold Partner and its ERP (Enterprise
Resource Planning) solution incorporates Cultivation, Production,
Global Compliance, QC, Finance, Dispensing & Retail, CRM,
Warehousing, Distribution, Multi-Facility, Multi-Company,
Multi-Entity, Language, Currency and more. The Company services a
client base comprised of leading U.S.-based MSOs and single-state
operators, and Canadian LPs, in addition to global cannabis clients
outside North America. Learn more
at www.365cannabis.com or call 888-609-6766.
Conference Call Details
Akerna will host a conference call tomorrow, Tuesday, September 14, 2021, at 8:00 a.m. Eastern Time to discuss the
acquisition. A question-and-answer session will follow prepared
remarks. Interested parties may listen to the call by dialing:
- Toll-Free: 1-877-407-3982
- Toll / International: +1-201-493-6780
- Conference ID: 13722555
The conference call will also be available via a live,
listen-only webcast and can be accessed through the Investor
Relations section of Akerna's website, https://ir.akerna.com/
To be included on the Company's email distribution list, please
sign up at https://ir.akerna.com/news-events/email-alerts
Forward-Looking Statements
Certain statements made in this release and any accompanying
statements by management are "forward-looking statements" within
the meaning of the "safe harbor" provisions of the United States
Private Securities Litigation Reform Act of 1995. When used in this
press release, the words "estimates," "projected," "expects,"
"anticipates," "forecasts," "plans," "intends," "believes,"
"seeks," "may," "will," "should," "future," "propose" and
variations of these words or similar expressions (or the negative
versions of such words or expressions) are intended to identify
forward-looking statements. Such forward-looking statements include
but are not limited to statements regarding the the timing and
completion of the acquisition of 365 Cannabis, the potential deal
being accretive to revenue and earnings and the expectation it will
contribute positive cash flow, the ability of Akerna to integrate
365 Cannabis, the impact of the acquisition for 365 Cannabis'
customers, Akerna's future business plans, Akerna's potential
business strengths in the market and any other statements
expressing the views of Akerna's management on future business
results or strategy. These forward-looking statements are not
guarantees of future performance, conditions or results, and
involve a number of significant known and unknown risks,
uncertainties, assumptions and other important factors, many of
which are outside Akerna's control, that could cause actual results
or outcomes (including, without limitation, the results of Akerna's
contracts, strategic initiatives, and business plans as described
herein) to differ materially from those discussed in the
forward-looking statements. Important factors, among others that
may affect actual results or outcomes, include (i) Akerna's ability
to recognize the anticipated benefits of being a public company,
(ii) competition, (iii) Akerna's ability to grow and manage growth
profitably, (iv) Akerna's ability to maintain relationships with
customers and suppliers and retain its management and key
employees, (v) costs related to being a public company, (vi)
changes in applicable laws or regulations, (vii) Akerna's ability
to identify, complete and integrate acquisitions, including 365
Cannabis, and achieve expected synergies and operating efficiencies
in connection with acquired businesses, (viii) and other risks and
uncertainties disclosed from time to time in Akerna's filings with
the U.S. Securities and Exchange Commission, including those under
"Risk Factors" therein. Actual results, performance, or
achievements may differ materially, and potentially adversely, from
any projections and forward-looking statements and the assumptions
on which those vary from forward-looking statements are based.
There can be no assurance that the data contained herein is
reflective of future performance to any degree. You are cautioned
not to place undue reliance on forward-looking statements as a
predictor of future performance as projected financial and other
information, are based on estimates and assumptions that are
inherently subject to various significant risks, uncertainties and
other factors, many of which are beyond Akerna's control. All
information herein speaks only as of the date hereof, in the case
of information about Akerna, or the date of such information, in
the case of information from persons other than Akerna. Akerna
undertakes no duty to update or revise the information contained
herein. Forecasts and estimates regarding Akerna's industry and end
markets are based on sources believed to be reliable; however,
there can be no assurance these forecasts and estimates will prove
accurate in whole or in part.
This press release does not constitute an offer to sell or a
solicitation of an offer to buy securities of the Company nor shall
there be any sell of securities of the Company in any state or
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such state or jurisdiction. The securities
to be issued in connection with the transactions described in this
press release have not been and will not be registered under the
Securities Act of 1933, as amended, or any applicable state
securities laws and may not be offered or sold absent such
registration or an available exemption therefrom.
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