Recent Marijuana Acquisition to Assist Sacramento Company with Statewide Presence

Recent Marijuana Acquisition to Assist Sacramento Company with Statewide Presence

MWG Holding Group, a Sacramento-based cannacompany recently make a new acquisition that could expand its California presence in the budding legal cannabis industry.

According to the Sacramento Bee, the acquisition happened in late December. The newly acquired wholesale distributor should give the company a significantly larger footprint in the California cannabis scene.

MWG plans to use the wholesale distribution company to expand its products across all of California. The addition will also allow MWG to increase its product sales from its 12 Perfect Union locations in Northern Cali to over 400 retail shops throughout the state.

However, MWG will not own the shops as it owns Perfect Union. Instead, the company is choosing to focus its growth strategy on supplying the dispensaries with its line of flowers, edibles, and concentrates.

While the acquired wholesale distributor only has a dozen employees, Perfect Union CEO Denyelle Bruno claims that this acquisition will help the company build its presence outside of its own shops.

“They are still small,” Bruno explained of the acquired distributor,” but it will definitely be a great opportunity for us to interact with other retail businesses.”

Bruno explained that through this new distribution network, Perfect Union plans to begin selling its cannabis products to more of Cali’s dispensaries. The company also operates several dispensaries scattered throughout New Mexico.

The majority of MWG’s employees are Sacramento-based.

MWG refused to disclose what it paid for the Santa Cruz-based distributor. But this is the company’s second acquisition in the last two months. In November, the company announced its acquisition of Bonsai Brands, a manufacturer of infused cannabis products based in Napa. Bonsai infuses drinks and baked goods.

Back in March, MWG announced $10.8 million in fundraising through an equity offering to investors. Bruno claims that some of that capital has been utilized to fund its recent acquisitions.

At this point, MWG’s funding comes from around 90 investors. Chris Running, the founder of Caveman Foods, is one of the company’s primary backers. He now runs as MWG’s executive chairman.

Even though cannabis legalization already happened in Cali, it’s still an illegal Schedule 1 drug at the federal level. Thus, it’s a challenge to get institutional investment for cannabis operations.

Despite this fact, Cali has already issued over 12,000 licenses to marijuana businesses in the last two years after legalizing cannabis for adult recreational use. However, the space is still struggling to obtain its foothold, with just several dozen large players, which includes MWG.

Even though MWG and Perfect Union have yet to disclose financial data, Bruno claims that both are profitable. With the outlook of Cali’s cannabis industry seeming highly profitable when looking at the state taxes placed on cannabis cultivation and sales, we can expect more large players to enter the space.

Do you operate a cannabis business? What’s your strategy for growing your company?

Author:
Louis Levey is the Content Success Manager and Founder at No Strings Content. He's passionate about helping cannabis businesses use content to attract, educate, and convert audiences. His hometown is Boca Raton, Florida, but he currently lives and works remotely in Chiang Mai, Thailand.

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