Weedmaps parent WM Holding’s stock sinks in second session following SPAC deal

Jun. 17, 2021 11:19 AM ETWM Technology, Inc. (MAPS)MAPSBy: Jerry Kronenberg, SA News Editor4 Comments

Beautiful Woman Smoking Marijuana In Plantation.
ArtistGNDphotography/E+ via Getty Images

  • Weedmaps parent WM Holding Co. (NASDAQ:MAPS) sank Thursday, giving back much of a big rally that it saw one day earlier following the closure of a SPAC deal that took the company public.
  • MAPS fell as much as 5.7% Thursday morning to trade at $19.37, reversing a large part of the 9.1% rally that the stock enjoyed Wednesday, its first trading day following a merger with special purpose acquisition company Silver Spike Acquisition Corp. (which formerly traded as “SSPK”).
  • WM Holding took over SSPK’s Nasdaq listing as part of the deal, changing its ticker symbol to “MAPS.”
  • Silver Spike agreed in December to take MAPS public via a special purpose acquisition company deal that valued the firm at some $1.5B.
  • Thirteen-year-old WM Holding operates the popular Weedmaps.com online site, which sells advertising for marijuana products, dispensaries and other elements of the legal-cannabis industry.
  • The company’s WM Business service also sells legal-cannabis firms software and other tech solutions. However, WH Holding doesn’t sell any cannabis products itself.
  • WH Holding CEO Chris Beals, who’s staying on following the merger, said in a statement that “we are excited to complete this business combination, which will further advance our mission to power a transparent and inclusive global cannabis economy, further solidify our position as a leading technology platform to the cannabis industry, and accelerate our growth.”
  • He said in an interview earlier this week that the company sees big growth possibilities in states where cannabis is already legal, as many are "underpenetrated in terms of retailers."
  • MAPS is receiving $579M in gross proceeds from the SPAC deal from Silver Spike and a $325M private investment in public equity (or “PIPE”).
  • PIPE participants included AFV Partners, Federated Hermes Kaufmann Funds, Senvest Management LLC and Silver Spike parent Silver Spike Capital.
  • The company said it expects to use $125M for expansion, with the balance going to pre-public investors.
  • Cornerstone Investments recently did a deep dive into the stock here.

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