This blog post was written by Alan Brochstein and the original post can be seen here.
In typical fashion for the company, Medical Marijuana, Inc. (MJNA) dropped an aggressive press release lacking substance in what appears to be a last-ditch effort to interest investors in its comatose stock. Before the market opened on 1/22/15, the company announced that it had signed a "Definitive Agreement to Acquire Kannaway, LLC", a newly formed multilevel marketing organization (MLM) that is owned by General Hemp, LLC. General Hemp is controlled by Stuart Titus, who has long ties to MJNA and was able to pull out $7mm from CannaVest (CANV) as he sold into the speculative peak last year as described by Forbes Magazine and detailed in SEC filings.
The press release described the products, shared some information about the company's success, and trumpeted a valuation by Houlihan Capital of "$119.6-242.7 million". That sounds huge considering MJNA itself is valued by the market at roughly $120mm based upon about 1 billion shares and a recent close near $0.12. In my view, it's what MJNA didn't say that should leave investors concerned:
- What are the terms of the "definitive agreement"?
- What are the financials of Kannaway?
- How will the acquisition benefit MJNA shareholders?
