Debra Borchardt
SLANG Worldwide Inc. (CSE: SLNG) (OTCQB: SLGWF) looks like it is putting itself up for sale. The decade-old cannabis company announced that it has retained PGP Capital Advisors, LLC, to assist in a review of its strategic alternatives. The Board of Directors said it has formed a committee of independent directors to help SLANG’s management team and PGP in exploring, reviewing, and evaluating strategic alternatives that may be available to maximize shareholder value.
“The company has been successful in driving organic growth and streamlining operations. With each of our business segments continuing to produce positive net income, EBITDA, and cash flow, the company is in the best financial health that it’s ever been,” said John Moynan, Chief Executive Officer of SLANG. “Our flexible strategy has allowed us to adapt and succeed in a challenging industry. I believe that this review will provide us with options that could create greater long-term value for SLANG and our shareholders as well as the ability to increase the scale of our business.”
Slang is best known for its O.pen vapes which originated in Colorado ten years ago. The company embarked on an ambitious expansion plan with unfortunate timing. It established markets on the West Coast just as those states began to contract. Slang then exited those markets and had much better success in the tiny state of Vermont.
Slang was at the top of its game in 2019 as shares traded over $10, but lately, shares traded for as little as two cents a share. The market cap for Slang is only $4.7 million. The company reported its second-quarter earnings in August with revenue slipping to $8.44 million, versus $9.87 million in the second quarter of 2022. Vermont is the company’s main source of growth, but it has also teamed up with Trulieve to enter markets like Maryland.
The company said it will evaluate a full range of strategic and financial alternatives, including, but not limited to, one or more of the following: a business combination, sale, divestiture, acquisition, or merger that may involve all or part of our business or assets, restructuring, recapitalization, refinancing, or any other strategic transaction that may be identified during our strategic review. The statement said that Slang is “evaluating these opportunities in order to explore synergies that may reduce the overhead costs associated with being publicly traded, provide opportunities to rapidly increase scale and market share, and to expand the overall product offering and footprint of SLANG.”
