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Unique: From chewing gum to gum, Beau Wrigley publicly information the pot producer Parallel

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© Reuters. FILE PHOTO: Cannabis garden next to the Mexican Senate building in a call for legalization

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By Shariq Khan

(Reuters) – Billionaire William "Beau" Wrigley Jr. is listing cannabis producer Parallel to complete a merger this summer with Canada-listed Ceres Acquisition Corp, which holds the Atlanta, Georgia-based company at 1.88 billion Valued at US dollars.

In parallel, the first company to run Wrigley Jr. since selling his family's chewing gum business for $ 23 billion in 2008 will take over Ceres' listing on the NEO stock exchange in anticipation of US regulations easing attracts investments for the pot sector.

The combined company expects to close the deal with $ 430 million in cash, a spokeswoman for Parallel confirmed to Reuters.

With around 50 retail stores, cultivation and manufacturing facilities in four US states, Parallel will use the money to expand into new markets. It sells finished products like gums, vapes, and balms, but not chewing gum.

U.S. companies that grow or sell cannabis cannot list their stocks on the country's major stock exchanges because marijuana remains illegal at the federal level.

Jay-Z-backed California pot maker TPCO Holdings also went public on NEO, while Weedmaps' parent company signed a deal in December to list on Nasdaq.

The Parallel spokeswoman said she has also received commitments from a group of investors for a private investment of $ 225 million in a public equity transaction (PIPE) when the deal closes.

The PIPE investment was oversubscribed, with a large portion of the increase being expected to come from existing parallel and Ceres investors, the spokeswoman said.

As more U.S. states legalize cannabis, officially approved sales rose to record levels during the COVID-19 pandemic.

In addition to decriminalizing the sale of weed products, Wrigley believes that one of the most important changes could be to ease restrictions on banking.

"That will frankly make life easier for companies like us to navigate some of these areas, and in a much more cost-effective manner," Wrigley, who will remain the combined company's chief executive officer, told Reuters.

US laws have prevented the interstate movement of pot products and deterred banks and other financial institutions.

But dealmaking and fundraising in the industry remain hot as expectations rise that President Joe Biden's administration will ease federal bans. (Graphic: Pot producers collect record money – https://graphics.reuters.com/CANNABIS-STOCKS/FUNDRAISING/xklvyozegvg/chart.png)

Joe Crouthers, managing director of Ceres, a Special Purpose Acquisition Vehicle (SPAC), said the cannabis market has a lot of positive momentum and there is still room for growth.

"You can see that not only are companies delivering, but governments are delivering on some of those talks and promises," said Crouthers, who will join Parallel's board of directors.

Scooter Braun, executive of the record industry, will act as special advisor to Parallel.

SPACs have become a popular way to go public because they can be completed faster than an IPO and provide more security about the funds a company will raise.

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