Features

The Green Organic Dutchman and BZAM announce merger

Published on October 21, 2022 by David Wylie

Photo: Contributed/BZAM

The Green Organic Dutchman is merging with BZAM Cannabis, creating the sixth largest pot producer in Canada.

The companies say the merger unites Canada’s East with West as TGOD’s strength is in Quebec and Ontario, while BZAM has a strong share of B.C. and Alberta markets.

They also say their facilities are the right size overall.

“Taken together, BZAM and TGOD have experienced one of the fastest growth rates in the Canadian cannabis market,” says the release.

• RELATED: Dunn Cannabis teams up with BZAM

Combined, they say they’ll have a net revenue of at least $100 million for calendar year 2023. The merger will also save them at least $10 million a year.

TGOD is publicly listed on the Canadian Stock Exchange (CSE), while BZAM is privately owned.

The news release says BZAM will hold 49.5% of the shares, with the ability to earn more shares by hitting certain milestones.

The announcement refers to the new company as the “combined entity.”

Over 400 SKUs between TGOD and BZAM

The companies say they are creating the market’s “most compelling product and brand portfolio.”

The product line will include vapes, infused pre-rolls, and high-quality flower across every price point—including -ness, Table Top, Dunn Cannabis, and FRESH brands.

“TGOD’s joint venture with Wyld has delivered some of the fastest growing cannabis edibles across Canada since their commercial launch in December 2021,” says the release.

Once the deal goes through, the company will keep BZAM’s current CEO Matt Milich and current Chief Commercial Officer (CCO) Jordan Winnett in their roles.

TGOD’s current CEO and Interim Chief Financial Officer, Sean Bovingdon, will take the role of CFO “in order to assist with the integration of BZAM and TGOD and the transitionary period” of the companies.

Quotes from the C-Suite

“We are looking forward to bringing together TGOD’s organic flower and hash with our crowd pleasing vapes and the exceptional flower of our craft partners, including Dunn Cannabis and FRESH,” says Milich.

“Together, we expect to expand on what we have each accomplished so far, as we build a strong, EBITDA-positive cannabis company.”

The transaction is scheduled to close on or about Nov. 3, subject to a number of customary conditions being satisfied or waived.

“This is an exciting day for both companies, for our employees, and for our consumers. We are bringing together two rapidly growing companies that share a passion for cultivation, innovation and brand development,” says Bovingdon.

“Our highly complementary businesses in terms of production footprints, products and distribution networks create a Combined Entity with a leading branded product portfolio along with significant synergies across our operations.”

By The Numbers:

• TGOD and BZAM generated $30.2 million and $32.2 million, respectively, of net revenue in calendar 2021;
• $31.6 million and $32.7 million, respectively, of net revenue from January to September 2022;
• Over 400 SKUs are listed across Canada; and,
• The board of directors will consist of 7 members, including 5 from TGOD and 2 nominated by BZAM