urban-gro, Inc. (Nasdaq: UGRO) (“urban-gro” or the “Company”), a
leading global horticulture company that engineers and designs
commercial Controlled Environment Agriculture (“CEA”) facilities
and integrates complex environmental equipment systems, today
announced that it has agreed to acquire MJ12 Design Studio and
parent company, 2WR+ Partners. urban-gro will fund the transaction
of $9.1 million through a combination of cash and UGRO common
stock, including contingent consideration of up to $2 million based
on achievement of certain performance metrics. The company expects
the transaction to be accretive to earnings in its current fiscal
year.
Acquisition of the award-winning, full-service
architecture firm greatly expands urban-gro’s services offering by
creating the industry’s first fully integrated architecture,
engineering, and cultivation systems integration company serving
the cannabis and food-focused CEA sectors.
Bradley Nattrass, Chairman and CEO of urban-gro
commented, “This accretive and synergistic acquisition positions
urban-gro for a strong future in the global CEA market. It will
have a significant positive impact on driving incremental
engineering and design services, as well as equipment system
revenues. The company can now directly address more challenges
faced by cultivators when expanding existing or designing new CEA
facilities. Our enhanced integrated menu of service offerings
affords clients the convenience of working with one company that
possesses the expertise to fully understand the plant, their
business, and the technical design aspects necessary to bring a
high-performance cultivation facility to life. The inclusion of
architecture allows us to now offer our clients complete design
capabilities for their cultivation, processing, extraction, and
retail facilities. Moreover, the move brings the company one step
closer to our goal of delivering complete, end-to-end turn-key
indoor CEA facilities.”
Upon closing, urban-gro, Inc. will acquire MJ12
Design Studios, along with its parent company 2WR+ Partners, a
multi-state architectural and interior design firm. The combined
23-person firm, including Senior Principal and Partner Sam Andras,
AIA, will join the urban-gro team. Mr. Andras will serve on the
executive leadership team, heading urban-gro’s architecture,
engineering, and design offering, which collectively now features
experience in over 400 CEA facilities.
“With its focus on growth in the European market
and strong capital position, urban-gro provides us with an
opportunity to execute on a global scale, which has been a
long-held vision for me and my team,” Andras said. “On behalf of
myself, my partners, and all of our employees, we are very excited
to be a part of the urban-gro team and propel the industry forward.
Joining this high-growth publicly traded company allows us to
collectively bring elite, plant-focused design solutions to even
more clients, in turn, facilitating the delivery of plant-based
medicines and locally produced food crops across the globe.”
Nattrass concurred stating, “The rapidly growing
global CEA sector for cannabis and food represents a tremendous
opportunity for our firms to combine our core competencies,
applying our experience and expertise to partner with clients in
achieving their goals. The acquisition presents an opportunity for
urban-gro to establish customer relationships much earlier in the
design process, creating a cascading effect of downstream potential
to provide the company’s existing service and equipment solutions
on MJ12’s current open projects and with new clients.”
“The addition of 2WR and MJ12’s high-margin
business offerings serves to further strengthen urban-gro’s
financial performance,” said Dick Akright, Chief Financial Officer
of urban-gro. “I am thrilled that this acquisition not only
executes along our strategic acquisition path, but it acts as a
natural progression for urban-gro to expand our reach. The addition
of MJ12’s existing projects strengthens our portfolio and better
equips us to meet the needs of our existing and future
clients.”
While urban-gro will acquire MJ12 for
coordinated architecture, engineering, and design services in the
CEA market, the company will continue to work with other
architectural partners at our clients’ request. Similarly, 2WR will
continue to work with and develop new relationships with other
engineering and design partners, as well as provide services in
non-cultivation markets including education, healthcare,
commercial, civic, multi-family, and hospitality.
About urban-gro, Inc.urban-gro,
Inc.® (Nasdaq: UGRO) is a global engineering and design services
company focused on the commercial horticulture market. With
experience in hundreds of Controlled Environment Agriculture (CEA)
facilities spanning millions of square feet, we engineer, design,
and integrate complex environmental equipment systems into
high-performance facilities.
For operating facilities, urban-gro’s gro-care®
Managed Services Platform leverages the company's expertise to
improve uptime, provide continuity, and drive facility
optimization. Operating as a crop-agnostic solutions provider in
both food and cannabis CEA sectors, our crop-focused end-to-end
approach provides a single point of accountability across all
aspects of growing operations.
Visit urban-gro.com to discover how we help
cultivators gro plants and gro profits.
About MJ12 Design StudiosMJ12
offers full design services addressing cultivation, processing,
manufacturing, operations, and retail dispensaries for the cannabis
industry. We are cannabis architect experts in a variety of
applications supporting cannabis facility design, including new
warehouse facility design for full indoor cultivation, processing
and operations, combination of warehouse and commercial greenhouse,
interior build-out and/or renovation of existing warehouse
facilities serving all aspects of cultivation and support
functions, and head-house designs supporting indoor and outdoor
cultivation.
About 2WR +
Partners2WR+Partners promotes architectural excellence in
every aspect of design. We have developed a rigorous methodology
that embraces authenticity through site, materiality, technology,
client goals, and budget. Through this collaborative process, we
develop a unique perspective through which we develop architecture
which is relevant and sustainable.
With offices now located in Columbus, Georgia;
Denver, Colorado; and Boston, Massachusetts, the firm serves
clients across the country. 2WR’s portfolio includes projects
ranging in construction budgets from $100,000 to $200,000,000. No
matter the budget, our clients are always provided with the highest
level of professional services with the focus of exceeding all
expectations. For more information, please visit 2wrarch.com.
Safe Harbor StatementThis press
release contains forward looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. When used
in this release, terms such as “believes,” “estimates,” “should,”
“could,” “would,” “plans,” “expects,” “intends,” “anticipates,”
“may,” “forecasts,” “projects” and similar expressions and
variations as they relate to the Company or its management are
intended to identify forward-looking statements. Such
forward-looking statements are based on current expectations,
forecasts, and assumptions that involve risks and uncertainties
that could cause actual outcomes and results to differ materially
from those anticipated or expected, including statements related to
the demand for our services and products, our ability to manage the
adverse effect brought on by the COVID-19 pandemic, our ability to
execute on our strategic plans, our ability to achieve positive
cash flows or profitability, our ability to achieve and maintain
cost savings, the sufficiency of our liquidity and capital
resources, and our ability to achieve our key initiatives for 2021.
A more detailed description of these and certain other factors that
could affect actual results is included in the Company’s filings
with the Securities and Exchange Commission. Readers are cautioned
not to place undue reliance on these forward-looking statements,
which speak only as of the date hereof. The Company undertakes no
obligation to update any forward-looking statements to reflect
events or circumstances after the date hereof, except as may be
required by law.
Investor Contact:Dan DrollerEVP
Corporate Developmenturban-gro, Inc.investors@urban-gro.com
Media Contact:Stan
WagnerManaging DirectorMaverick Public
Relations303.618.5080stan@themaverickpr.com
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