In a lead-up to spinning off its hemp-based CBD interests, Los Angeles-based Vertical Companies closed a $58 million Series A funding to build out the company’s footprint and bring its brands to market.
A subsidiary, Vertical Wellness, a hemp-based CBD operator and brand firm with 2,000 acres of hemp cultivation contracted for 2019, will be spun off to shareholders of record as of April 1.
The move comes on the heels of passage of the 2018 Farm Bill.
Vertical Wellness includes all the parent company’s hemp-based CBD assets as well as manufacturing and extraction operations.
The company originally targeted a $20 million funding but boosted that to $35 million in late 2018 because of investor demand.
The $35 million goal was oversubscribed by $23 million, bringing the total to $58 million.
The raise was led by cannabis industry private equity fund Merida Capital Partners and international companies, including “significant players in the alcohol distribution and brand space,” according to a news release.
The company’s other subsidiaries include:
- Vertical MSO, which is expected to reach roughly 1.9 million square feet of cannabis cultivation this year as well as extraction and manufacturing facilities.
- Vertical Distribution, which has several distribution operations in California, including Los Angeles, Needles and Oakland.
In January, the company announced it had accumulated 161 business licenses in California alone.
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