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A cannabis company is throwing down the gauntlet to White Claw

November 5, 2020, 3:05 PM UTC

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While cannabis has not yet been federally legalized in the U.S., Aphria, a Canadian cannabis company, is laying down the rails in preparation for looser regulations across the country.

It’s throwing down $300 million to acquire SweetWater Brewing Company, an Atlanta-based beer maker known for a drink that tastes and smells like pot without the actual substance. For Aphria, which currently has no operations stateside, the acquisition is a way to introduce its own brand to the U.S. and also launch THC beverages in Canada.

“Aphria expects to leverage SweetWater’s innovation, manufacturing, marketing and distribution infrastructure in the southeast with expansion opportunities across the U.S. for craft beer and cannabis products, subject to federal legalization of cannabis,” Aphria CEO Irwin Simon said in an analyst call Wednesday. And because of its brand of marijuana-esque beers, SweetWater is “well aligned with the cannabis lifestyle.”

Beer companies have struggled as drinkers have opted for new options such as canned wines or spiked seltzers like White Claw. Beer giants such as Constellation Brands have sought to diversify their offerings by expanding into cannabis-related products. The now $34 billion company behind Corona took a stake in marijuana company Canopy Growth three years ago.

And Aphria may well be hoping to throw all of these trends together: “I mentioned earlier SweetWater’s recent entry into rapidly growing hard seltzer,” Simon said during the call. “We believe the hard seltzer could be a very attractive form of cannabis products and develop over time, and we look for SweetWater to be a strong competitor to White Claw and Truly.”

Aphria will pay $250 million in cash and $50 million in stock. 

The deal comes as Arizona, New Jersey, and Dakota voted this week to legalize recreational marijuana.

TIKTOK PARENT SEEKS A $180 BILLION VALUATION: ByteDance, the Chinese company behind TikTok, is in talks with investors including Sequoia to raise $2 billion at a $180 billion valuation, per Bloomberg. The discussions come ahead of a potential IPO of some of its businesses in Hong Kong, and, of course, an unforgettable battle with the Trump administration over a ban on TikTok in the U.S. The app is still awaiting approval from U.S. and Chinese regulators over a proposed deal that would have Walmart and Oracle take on a 20% stake in the business.

In particular, ByteDance is said to be considering an IPO of TikTok’s Chinese counterpart, Douyin.

VENTURE DEALS

- Zhangyue, a Chinese ebook publisher, raised 1.1 billion yuan or $170 million from ByteDance, representing a 11% stake. Read more.

- eSign, a China-based e-signature company, raised $150 million in Series D funding. Shenzhen Capital Group, Evergrande High-Tech Group, and Fortune Capital led the round. Read more.

- Wanwu Dezhi, a Chinese antiques and collectables platform, raised $80 million in a Series C funding. Invesetors included China Renaissance’s Huaxing New Economy Fund and Source Code Capital. Read more.

- Ayar Labs, a Santa Clara, Calif.-based developer of a way to move data via optical connections, raised $35 million in Series B funding. Downing Ventures and BlueSky Capital led the round and were joined by investors including Playground Global, Applied Ventures, Castor Ventures, SGInnovate, BlueSky Capital, Founders Fund, GLOBALFOUNDRIES, Intel Capital, and Lockheed Martin Ventures. 

- The Protein Brewery, a Netherlands-based maker of non-animal-based proteins, raised €22 million ($26 million) in Series A funding led by Novo Holdings, and was joined by investors including Roquette Ventures and Unovis Asset Management

- Provizio, an Ireland-based sensor platform for preventing car accidents, raised $6.2 million in seed funding. Investors included Bobby Hambrick (founder of Autonomous Stuff), the European Innovation Council, and ACT Venture Capital.

- Osome, a Singapore-based super app in the accounting and corporate compliance space, raised $3 million in funding. XA Network and AltaIR Capital led the round. 

- Riverside.fm, a video podcasting platform, raised $2.5 million in funding. Oren Zeev led the round.

- Talking Medicines, a Glasgow and London-based platform for monitoring patient behavior and conversations around medication, raised £1.1 million in funding. Tern led the round and was joined by investors including The Scottish Investment Bank. Read more.

- Podcastle, a Middletown, De.-based maker of a platform for turning articles into podcasts, raised $1.75 million in seed funding. Sierra Ventures led the round and was joined by investors including AI Fund and Correlation Ventures.

- Protomer Technologies, a Pasadena, Calif.-based biopharmaceutical company, raised an undisclosed amount of funding from the DRF T1D Fund. 

PRIVATE EQUITY

- IFM Investors acquired a “significant” minority interest in Zuuse, a Portland-based provider of construction payment management SaaS solutions. The deal was made for A$50 million ($36 million).

- Apollo Global Management is reportedly interested in acquiring a minority stake in DirecTV from AT&T. Read more.

- Carlyle Group and MBK Partners are reportedly showing interest and acquiring Japanese skincare brand Fancl’s Asia business outside of Japan. Read more

- Nordic Capital acquired Amsterdam-based BearingPoint's regulatory technology business unit. Financial terms weren't disclosed.

- The Planet Group, backed by MidOcean Partners, agreed to acquire NDA Partners, a Rochelle, Va.-based life sciences management consulting and contract development organization. Financial terms weren't disclosed.

- West Monroe acquired Pace Harmon, a Washington D.C.-based IT and business services firm. Financial terms weren't disclosed.

EXITS

- Merck (NYSE: MRK) plans to acquire VelosBio, a maker of cancer therapies, for $2.75 billion in cash. Firms including Sofinnova Investments, Takeda Ventures and Surveyor Capital backed VelosBio.

- Lightspeed POS (NYSE: LSPD) agreed to acquire ShopKeep, a New York City-based cloud commerce platform. ShopKeep investors have included Activant Capital, Canaan Partners, and TTV Capital.

OTHERS

- Alimentation Couche-Tard agreed to acquire Convenience Retail Asia’s convenience store business in Hong Kong for HK$2.8 billion ($360 million). Read more.

- Carrefour acquired Bio c’ Bon, a Paris-based chain or organic supermarkets, for €60 million ($70 million).

IPO

- Midwest Holding, an underwriter of life insurance products, filed to raise $50 million in an IPO. Read more.

SPAC

- Capitol Investment Corp. V filed to raise $300 million. Read more.

- Roman DBDR Tech Acquisition, a blank check company seeking a target in the tech, media, and telecom sector, now says it plans to raise a lower $220 million. Read more.

F+FS

- CIVC Partners is looking to raise $525 million for its sixth fund. Read more.

- 10D, an Israel-based venture firm, raised $110 million for a fund targeting early stage startups. Read more.

PEOPLE

- Sequoia Capital Partner Michael Abramson, who co-led Sequoia's U.S. growth business, left the venture firm, sources confirm.