MJ Biz
Former lenders to Parallel, the struggling cannabis multistate operator once led by chewing-gum heir William “Beau” Wrigley, finalized their takeover of company assets this week, according to a Monday announcement.
And after acquiring “certain” Parallel assets in Florida, Massachusetts and Texas, Canadian cannabis and liquor giant SNDL now claims a retail footprint of 249 licensed locations – “the largest in the world by store count,” CEO Zach George claimed in a press release Monday.
As part of the acquisition, SNDL, which has been acquiring properties across Canada for the past few years, now operates:
- Surterra Wellness and 43 medical marijuana dispensaries and a 175,000-square-foot cultivation facility in Florida
- Goodbled and its 10 retail and pickup locations in Texas, which last year greatly expanded its medical cannabis program
- Massachusetts-based NETA and its three retail locations and single cultivation and production facility
What happened to cannabis company Parallel and Surterra Wellness?
It’s the latest development in a long-running saga for Parallel and its subsidiaries, which defaulted on a $150 million loan amid overall debt obligations in excess of $842 million, SNDL said in its release Monday.
And it’s the latest example of a cannabis company taken over by its former lenders. Earlier this year, an affiliate of Boston-based Millstreet Capital Management, which loaned cash to Ayr Wellness, took over that company’s vertically integrated medical cannabis permit in Virginia.
In Parallel’s case, SNDL took over the company after “an extensive marketing process … did not result in an acceptable third-party transaction,” according to Monday’s press release.
The finalization of SNDL’s takeover of Parallel, first announced in April, also follows the closure of two Surterra Wellness cultivation facilities in Florida, according to a July 21 missive from Parallel Florida to state officials.
Sometime this past month, Parallel shuttered cultivation operations in Wimauma and Lakeland, where it had formerly employed 211 people, the company said in a federally mandated Worker Adjustment and Retraining (WARN) Act notice.
Wrigley took over as CEO of Surterra Wellness in 2018. The company rebranded to Parallel and quickly embarked on an ambitious expansion plan. However, Wrigley stepped down as CEO in 2021 after a plan to take the company public at a $1.9 billion valuation via a special acquisition company (SPAC) fell apart.
Wrigley was later sued by his former investors. And landlords across the country began filing suits for unpaid rent.
What’s the largest cannabis company in the world?
For now, SNDL has indirect majority control of the former Parallel assets through its affiliate SunStream Bancorp, which also took over troubled Michigan operator Skymint.
It plans to keep the adult-use cannabis operations in Michigan “deconsolidated” to comply with Nasdaq requirements, according to Monday’s announcement.
That still makes SNDL “one of the first” companies listed on Nasdaq to have U.S.-based cannabis operations.
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