Akerna Gains on Buying 365 Cannabis

Akerna Corp (NASDAQ:KERN) announced it has signed an agreement to acquire 365 Cannabis, a cannabis business management software system built on Microsoft's Dynamics 365 Business Central in a $17 million deal at 2.1x LTM revenue.

The consideration includes $4 million in cash and $13 million stock with a potential earnout of $8 million. The acquisition is expected to close in Q4.

"By adding 365 Cannabis into our Akerna ecosystem, we will continue to create new standards and best practices around compliance in every state, province, and country across the globe, standardize how the global supply chain is managed, and forge best practices in technology and hosting," says Akerna CEO Jessica Billingsley.

"The synergies between our two companies' products and offerings will finally create all in one for the entire cannabis industry, on a global scale."

Said 365 Cannabis CEO Jeff Kiehn, "As we combine our leading solutions built specifically for the ever-evolving cannabis industry, along with Akerna's 80+ integrations through open APIs, we can now offer cannabis operators a full suite of products to optimize their businesses, improve overall functionality, and ultimately increase sales.”

365 Cannabis' 85+ clients will gain access to Akerna's Compliance Gateway, feature-rich reporting, MJ Retail POS, and the recently launched Akerna Connect.

The acquisition of 365 Cannabis adds Microsoft capabilities, further strengthening Akerna's cannabis-compliant ERP system offering. Akerna has also partnered with other providers for integrated financials and tax planning.

Akerna held cash and equivalents of $12.29 million as of June 30, 2021.

KERN shares are trading higher by six cents, or 1.8% at $3.37early in Tuesday’s session.