Shares of Medmen Enterprises Inc (OTCMKTS:MMNFF), are testing key potential support as we enter the action this week. To further flesh out the story here, the company just announced that, further to the binding letter of intent in respect of a business combination transaction announced on October 11, 2018, they have entered into a definitive business combination agreement pursuant to which MedMen and PharmaCann will combine their respective businesses.

According to the release, “Under the Business Combination Agreement, a newly formed holding company (“New MedMen”) will acquire (a) all of the securities of PharmaCann in exchange for subordinate voting shares of New MedMen (the “New Class B Shares”) that are identical to the current Class B subordinate voting shares of MedMen, and (b) all of the Class B subordinate voting shares of MedMen in exchange for New Class B Shares on a one for one basis, pursuant to a plan of arrangement under the laws of British Columbia (the “Arrangement”). The securities to be issued in the Arrangement are intended to be eligible for exemption from the registration requirements under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”), in accordance with Section 3(a)(10) thereof. In addition, all of the Class A super voting shares of MedMen will be acquired by New MedMen in exchange for super voting shares of New MedMen (“New Class A Shares”) on a one for one basis, pursuant to the Arrangement.”

Medmen Enterprises Inc (OTCMKTS:MMNFF) frames itself as a company that, together with its subsidiaries, operates in the cannabis space in the United States.

The company cultivates, produces, possesses, uses, and distributes/retails cannabis in the recreational and medicinal cannabis marketplace. As of June 6, 2018, it owned and operated 18 licensed cannabis facilities under the MedMen brand name in California, Nevada, and New York.

The company frames itself as “the preeminent cannabis company in the United States” with multiple assets and operations in California, Nevada, New York, and Florida. MedMen owns and operates licensed cannabis facilities in cultivation, manufacturing, and retail, and is one of the most well-recognized cannabis brands in the world today.

Headquartered in Los Angeles, MedMen employs more than 800 workers across the United States. It was founded in 2010 by Adam Bierman and Andrew Modlin, two visionary entrepreneurs who saw not just a tremendous business opportunity in the growing legalization of marijuana, but a chance to re-define our society’s relationship with cannabis. MedMen supports sensible, clear and just drug laws.

The Company is the single largest financial supporter of progressive marijuana laws at the local, state and federal levels, giving directly to pro-legalization groups, industry organizations and political candidates.

The company is headquartered in Culver City, California. MedMen Enterprises Inc. is a subsidiary of The Medmen Of Nevada 2 Llc.

According to company materials, “MedMen Enterprises is a leading cannabis company in the U.S. with assets and operations across the country. Based in Los Angeles, MedMen brings expertise and capital to the cannabis industry and is one of the nation’s largest financial supporters of progressive marijuana laws.”

As noted above, MMNFF just announced that the company has entered into a definitive business combination agreement pursuant to which MedMen and PharmaCann will combine their respective businesses. In all, traders will note flat action for share values of the company over the past week of action.

In addition, the company has seen interest climb, with an increase in recent trading volume of 24% beyond its prior sustained average level.

Interestingly, according to materials from the company in its most recent release, “The resulting pro-forma company (including pending acquisitions by MedMen) is anticipated to have a portfolio of cannabis licenses across the U.S. that will permit the combined company to operate 76 retail stores and 16 cultivation and production facilities. The combined company will operate in 12 states, which comprise a total estimated addressable market, as of 2030, of approximately $40 billion according to Cowen Group. Through the Transaction, MedMen is anticipated to add licenses in Illinois, New York, Pennsylvania, Maryland, Massachusetts, Ohio, Virginia, and Michigan.”

At this time, carrying a capital value in the market of $1.3B, MMNFF has about $12.2M in cash on the books, which must be weighed relative to a mountain of over $86M in total current liabilities. The company has been pulling in significant revenues, with over $7M in Q1 of this year, representing over 630% quarterly y/y growth on the top line. This is an exciting story, and we look forward to a follow-up chapter as events transpire.