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Weedmaps Will Go Public Through Silver Spike SPAC Merger

Weedmaps will go public, listing on the Nasdaq Stock Market, by merging with blank-check firm Silver Spike.

WM Holding Co., a technology platform for cannabis businesses and consumers, said on Thursday that it would merge with blank-check firm Silver Spike  (SSPK) - Get Silver Spike Acquisition Corp Class A Report to become a public company, listing on the Nasdaq Stock Market.

Silver Spike shares at last check rose 31% to $13.74.

WMH, Irvine, Calif., operates Weedmaps, a site and app through which consumers can find cannabis businesses; and WM Business, a software-as-a-service subscription for cannabis retailers and brands. 

Weedmaps has more than 10 million monthly active users and 18,000 business listings across every state with a legal cannabis market, the District of Columbia, and Puerto Rico.

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The transaction will provide the new company as much as $575 million of gross proceeds, including $250 million of cash held in trust by Silver Spike plus a so-called PIPE -- private investment in public equity -- of $325 million at $10 a share.

The companies estimate that after the closing, the equity value of the combined company will be $1.5 billion. The deal is subject to a vote of Silver Spike holders and other conditions. 

“With this merger, we will be able to continue scaling the Weedmaps marketplace in the U.S. and internationally in service of our users while expanding the functionality of our WM Business SaaS offerings in service of our clients,” Chris Beals, chief executive of WM Holding, said in a statement. 

The U.S. cannabis market "is expected to double over the next five years as the majority of U.S. adults support having legal access to cannabis," the companies said. 

Beals is set to become CEO of the combined company as well. Silver Spike's chairman and CEO, Scott Gordon, will join the board of the combined group.