High Times Rolls Up Another Conference with BIG Show Acquisition – More M&A in Store?
High Times Purchases B2B Conference Operator Buyers Industry Guide
The parent of High Times magazine has acquired a major cannabis event operator just days after clearing most of the debt from its balance sheet, a likely sign of more deals to come.
High Times Holding Corp, which operates the renowned Cannabis Cup events along with Reggae On The River and the High Times Business Expo, said Friday it agreed to purchase Buyers Industry Guide, owner of the BIG Show industry conferences. The B2B tradeshows gather twice annually in Miami and Los Angeles with over 10,000 industry guests annually.
“The Big Show has a great reputation throughout the industry, so to bring their brand in-house is really exciting,” said High Times CEO Adam Levin. “They’ve developed an impressive roster of attendees, and a loyal audience – we’re looking forward to continuing to add more resources and additional programming in future years.”
Just last week High Times said it had reduced $28.6 million of existing debt through a conversion and warrant exercise and that it had raised $13.2 million from over 15,000 investors in its ongoing IPO. That puts High Times in a position to acquire more companies such as conference operators which can bear significant leverage thanks to recurring revenue.
The news comes as High Times is raising up to $50 million in a Regulation A+ IPO open to all investors until the end of January. The complete offering details are available at the company’s investing portal here. The company plans to use the IPO proceeds to invest in growth across both existing and new business platforms.
A conference rollup strategy is smart for High Times on multiple counts. First, it already works with conference operators including the BIG Show, which has used the High Times sales infrastructure. That suggests there is room to reduce costs as it combines several conferences together. Also, the High Times brand is stronger than any other in the industry, so more attendees may take interest in the events with the new affiliation.
High Times also recently acquired DOPE Media for $11.2 milllion. DOPE has regional publications along with Dope Cup events that complement Cannabis Cup events.
High Times has several other growth engines beyond conferences. For instance, until current management took over, the company had neglected to pursue a serious digital strategy. The company’s plans include the recent launch of an over-the-top streaming service that’s akin to a Netflix of cannabis, reflecting a fresh push to monetize the High Times brand – the strongest in the marijuana industry.
The cannabis industry has drawn attention from investors and blue-chip companies in recent months as legalization in more U.S. states creates growth opportunities. Big Tobacco leader Altria recently announced a $1.8 billion investment in Cronos Group earlier in December. Also, beer company Constellation Brands recently increased its stake in Canopy Growth with a $3.8 billion investment in the Canadian cannabis grower, a deal that surprised investors.
Once public, High Times will join other listed, growth-stage companies focused on the burgeoning cannabis industry. Those include MassRoots, which operates a mobile app for marijuana consumers to share and compare reviews. Another is KushCo Holdings, which offers products to marijuana dispensaries and growers. Most recently, Level Brands agreed this week to purchase CBD manufacturer cbdMD ahead of legislation expected to make hemp treated like a traditional crop, clearing a path for broader CBD sales.
IPO Edge recently published a detailed financial analysis of the High Times IPO. One key to the company’s potential is its strong brand name, which is known even among those who don’t currently consume marijuana.
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John Jannarone, Editor-in-Chief
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