LOS ANGELES--(BUSINESS WIRE)--
MassRoots, Inc. ("MassRoots" or the "Company") (MSRT), a technology platform for the regulated cannabis industry, is pleased to release the following update on its planned acquisition of COWA Science Corporation (“COWA”) in a stock-based transaction valued at approximately $5.78 million, dependent upon COWA achieving revenue milestones of $2.5 and $7.5 million (the “Planned Acquisition”). For more information on the Planned Acquisition, please see the Company’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on February 12, 2019.
“As an applied physicist from Texas with a background in the oil and gas industry, I am focused on commercializing technology and metrics that we can measure: revenue and cash-flows generated from operations,” stated Chris Alameddin, Chief Executive Officer of COWA Science Corporation. “We respect the network and the numerous relationships MassRoots has built over the past five years and we believe the synergies between our two companies will result in our achievement of the revenue goals we've set out for the fiscal year 2020. We look forward to closing this transaction as early as this month and then working tirelessly on behalf of MassRoots’ shareholders over the next several years.”
Based on the closing price of MassRoots’ common stock of $0.07 on April 12, 2019 and after giving effect to the fifty million shares issuable to COWA’s shareholders upon closing of the Planned Acquisition, the market capitalization of the combined companies post closing would be an estimated $16.3 million.
“Numerous companies in the cannabis sector are trading at multiples of 5, 10, and even 25 times forward annual revenues,” stated Isaac Dietrich, MassRoots’ Chief Executive Officer. “As providers of the products and services that cannabis companies need to operate and grow their businesses, MassRoots and COWA are and will be able to generate revenue and gain market share in every state in which the sale of cannabis is regulated. We believe the revenue goals stated in the Planned Acquisition’s definitive agreements will be achieved during fiscal year 2020 and this transaction will be immediately accretive to MassRoots’ shareholders.”
MassRoots’ financial model is structured to capitalize on the trend of states creating and expanding regulated cannabis markets. Because the Company is not involved in the production or sale of cannabis, MassRoots does not have to build grow facilities, open retail stores, hire additional staff, apply for licenses, or have a physical presence in a particular state in order to generate revenue. Further, as its financial model is not tied to the success of a particular location or brand, we believe the Company can have a significant percentage of all dispensaries and brands on its platform, making MassRoots a play on the cannabis industry as a whole.
Through the Planned Acquisition, MassRoots’ strategy is to establish itself as a provider of products and technologies at every step of the cannabis supply chain—from cultivators to dispensaries to consumers.
MassRoots, Inc. is a leading technology platform for the regulated cannabis industry. Powered by more than one million registered users, the Company's mobile apps empower consumers to make educated cannabis purchasing decisions through community-driven reviews. Its rewards program, WeedPass™, enables consumers to earn tickets to movies, sporting events, and festivals by shopping at participating dispensaries. MassRoots has been covered by CNN, CNBC, Fox Business, Fortune, Forbes, and Reuters. For more information, please visit www.MassRoots.com/Investors and review MassRoots' filings with the U.S. Securities and Exchange Commission.
This press release contains certain forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are identified by the use of the words "could," "believe," "anticipate," "intend," "estimate," "expect," "may," "continue," "predict," "potential," "project" and similar expressions that are intended to identify forward-looking statements. All forward-looking statements speak only as of the date of this press release. You should not place undue reliance on these forward-looking statements. Although we believe that our plans, objectives, expectations and intentions reflected in or suggested by the forward-looking statements are reasonable, we can give no assurance that these plans, objectives, expectations or intentions will be achieved. Forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from historical experience and present expectations or projections. Actual results to differ materially from those in the forward-looking statements and the trading price for our common stock may fluctuate significantly. Forward-looking statements also are affected by the risk factors described in the Company's filings with the U.S. Securities and Exchange Commission. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.