South Buffalo pot farm operator acquired by Florida company

RIV Capital, the Toronto company that was to operate the facility built by Zephyr Partners in the Buffalo Lakeside Commerce Park, is being acquired by Cansortium Inc., which will take over the company and become Zephyr’s tenant.

Tampa-based Cansortium agreed late last month to pay $27.15 million in stock to buy RIV, owner of the Etain brand in New York. This will create a combined company with cannabis licenses and operations under the Fluent brand in Florida, New York, Texas and Pennsylvania. These operations include eight cultivation and processing facilities and 42 retail dispensaries.

“The combined company will enable RIV Capital to realize its vision of becoming an established multi-state operator capable of deploying capital for strategic investments beyond New York,” said Mike Totzke, CEO and Director of the interim operation of RIV Capital. “In an environment where state-issued cannabis licenses are limited, Cansortium opens doors to important growth markets in the United States. »

Most importantly for Cansortium, it will gain a major national relationship with ScottsMiracle-Gro Co., which owns and indirectly supports RIV through its wholly owned subsidiary, Hawthorne Collective, and Hawthorne Gardening Co. Scotts, based in Ohio, is a major producer of lawns. and gardening products known for its fertilizers and weedkillers which have also entered the cannabis industry.

“Through its relationship with RIV Capital, Hawthorne has used its research and development capabilities to recommend innovative cultivation products to support the development of Etain and its adult use in New York, and we look forward to providing continued support for this exciting and broader platform. “, said Chris Hagedorn, president of Hawthorne and director of RIV. “Hawthorne and ScottsMiracle-Gro fully support the agreement.”

“The plan to bring together these two companies with major strengths in key growth states should position us to generate short-term synergies, capitalize on long-term value creation opportunities while continuing to provide high-quality service. quality to customers who call Florida. and New York with the Fluent brand experience,” said Robert Beasley, CEO of Cansortium.

We do not know exactly what impact this agreement will have on the Buffalo project, although it is supposed to be the new flagship operation of RIV and Etain. Zephyr officials could not be reached for comment Tuesday evening.

Zephyr, an Encinitas, Calif.-based investment and development company owned and led by Buffalo native Brad Termini, is spending $80 million to build the first phase of what could ultimately be a “cannabis campus.” $300 million high-tech project for marijuana cultivation and manufacturing. . This will include greenhouses for cultivation as well as manufacturing facilities for making oils, balms, lotions, extracts, edibles, beverages and other cannabis-infused products.

It will begin with the $27.8 million construction of two single-story steel-framed structures for RIV and Etain – a 68,275 square foot manufacturing plant and a 7,076 square foot office building – on 10.8 acres of land at 310 Ship Canal Parkway. and another 4.9 acres at 15 Laborers’ Way. It’s part of a much larger 72.4-acre property in the business park just off Tifft Street, east of Route 5, that Zephyr is buying from Buffalo Urban Development Corp.

Ultimately, Termini and Zephyr plan to create more than 1.38 million square feet of building space to grow marijuana plants, manufacture a variety of products and conduct medical research – including potential benefits for patients with of cancer. Officials previously said the farm would be capable of growing more than $19 million worth of recreational cannabis, enough for more than 5 million joints or 20 million candies each year.

Now it would be Cansortium instead of RIV.

The transaction is expected to be completed in the fourth quarter. The new combined company will have revenue of $105 million and pre-tax profit of $27 million. Officials expect to save between $5 million and $10 million in operating expenses through cultivation and transformation efficiencies, business integration and the elimination of redundant public company costs.