Jay-Z To Become "Chief Visionary Officer" Of New SPAC

Matty-Sways

Subversive Capital Acquisition Corp. acquiring cannabis brands Caliva and Left Coast Ventures to form a Parent Company.

Billionaire Jay-Z plans to join Subversive Capital Acquisition Corp., the company set to be California's largest cannabis brand, as a "chief visionary officer". The Parent Company hopes to reach 90% of all cannabis users in California by 2022. (sales in California reaching almost $3 billion last year) This announcement comes shortly after Jay-Z announced a partnership with Caliva in October that will see him launch his own cannabis line, Monogram. 

The cannabis industry could grow into an $80 billion industry by 2030 if it becomes legal under federal law, according to the investment bank Cowen. 

Jay-Z's Roc Nation announced an exclusive partnership with The Parent Company simultaneous with its formation, while Roc Nation artists Rihanna, Yo Gotti, and Meek Mill also joined as investors in the newly formed company via a private placement. 

The Subversive Capital Acquisition Corp already holds about $575 million in cash in trust, meaning The Parent Company is expected to become one of the best-funded cannabis companies in the US. Its combine evenues from Caliva and Left Coast Ventures are projected to reach $185 million in 2020 and $334 million in 2021. 

Jay-Z's work as chief visionary means he will run the company's Social Equity Ventures, which has pledged to invest at least 2% of its net income into BIPOC-owned cannabis businesses.

The Social Equity Ventures unit will also "contribute to the effort to rectify the wrongs of prohibition through initiatives that are working toward meaningful change in the criminal justice system,"

"Although we know we can't fully redeem the injustices created by the 'war on drugs', we can help shape a brighter and inclusive future," Jay-Z said in the press release. "The brands we build will pave a new path forward for a legacy rooted in equity, access, and justice. We're creating something people can trust and we're investing in our future, our people, and our communities."

Several cannabis SPACs have turned into multimillion-dollar juggernauts through deals similar to The Parent Company. In August, Credit Suisse led Silver Spike Capital's $250 million public offering, and Citigroup's Canadian branch helped lead the $350 million SPAC public offering of the private equity firm Bespoke Capital, Jeremy Berke reported.

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