Assets for cannabis operator StateHouse for sale in receivership

A brokerage firm has listed for sale the assets of California cannabis operator StateHouse Holdings in what could be the industry’s “largest receivership deal,” MJBizDaily has learned.

The portfolio for San Diego-headquartered StateHouse includes several brands, business licenses and retail outlets throughout the state.

StateHouse formerly was known as Harborside, a legacy California marijuana operator once based in Oakland.

San Diego-based Green Life Business Group is handling the liquidation proceedings for one of the state’s oldest cannabis companies on behalf of Receivership Specialists.

Receivership Specialists was founded by Kevin Singer, who was appointed receiver in similar proceedings earlier this year to dissolve Herbl and High Times.

The bidding process, which ends Jan. 15, could set an industry record, considering the brands and stores in the portfolio have combined sales of more than $120 million, according to Green Life CEO Drew Mathews.

“To my knowledge, it’s the largest receivership deal in U.S. (cannabis) history,” he told MJBizDaily in a phone interview.

Cannabis assets for sale

The licensed assets for sale include:

• 11 stores under the Harborside and Urbn Leaf brands.
• Cultivation properties.
• Nurseries.
• Processing and distribution.

Ten of the 11 stores are operational and expected to generate sales of nearly $78 million this year, Mathews said.

The former StateHouse brands for sale include:

• Dime Bag.
• Fuzzies.
• Harborside.
• Harborside Farms.
• Kingpen.
• Kingroll.
• Loudpack.
• Smokiez.
• Urbn Leaf.

The brands are carried in more than 900 California retail outlets, according to marketing materials from the receivership.

Mathews said the receivership prefers a global offer or a bid for the entire portfolio.

StateHouse entered bankruptcy in October after its main lender, Pelorus Fund REIT, a private mortgage real estate investment trust, asked a court to place StateHouse in receivership after the vertically integrated marijuana operator defaulted on four loans.

Pelorus is owed more than $140 million, according to industry sources and court documents.

The trading of StateHouse shares have been halted on the Canadian Securities Exchange (STHZ) and over-the-counter markets (STHZF).

High Times receivership update

The StateHouse asset sale is expected to generate more buzz and interest than that of cash-strapped marijuana brand and publication High Times.

In that liquidation, Green Life generated 36 offers in 17 days, including a six-figure offer for 420.com, Matthews said.

That website is one of several assets for sale from the portfolio of Hightimes Holding Corp. – the Los Angeles-based parent of High Times – which entered receivership in April.

“I’m getting a full 60 days on this listing that’s going to probably generate 10 times (more) traffic than High Times,” Mathews told MJBizDaily.

A diverse group of potential bidders has shown early interest, including public companies, multistate operators and new investors in the space, he added.

Meanwhile, the asset sale of High Times is nearing a conclusion.

“We are in escrow with a group right now, and we’re hoping to close by the end of the year,” Mathews said.

Chris Casacchia can be reached at chris.casacchia@mjbizdaily.com.