Sale to MGG Investment Group Creates Financial Flexibility to Execute Growth Strategy!

Appoints Seasoned Executive Andrew Barnett as Chief Executive Officer

WINCHESTER, Ky.–(BUSINESS WIRE)–GenCanna Global USA, Inc. (“GCG” or the “Company”) today announced that it has received approval from the United States Bankruptcy Court for the Eastern District of Kentucky to sell substantially all of its assets to funds managed by its long-term investor, MGG Investment Group (“MGG”).

This transaction will enable GenCanna to maintain its operations in Kentucky as a leading standalone CBD and wellness business with significantly reduced debt and substantial new capital to pursue growth opportunities. In conjunction with the completion of the sale to MGG, GenCanna has appointed veteran executive Andrew Barnett as Chief Executive Officer, effective immediately.

“I am pleased to join GenCanna at this critical time in its evolution and look forward to stewarding the Company into its next chapter,” said Mr. Barnett. “GenCanna’s industry-leading technology and deep customer focus will enable it to continue to deliver great products, especially at a time when consumers are increasingly aware of and incorporating high-quality CBD into their health and wellness routines. Today, GenCanna is a stronger, better capitalized, and more competitive company that is poised to further its leadership position in the still emerging hemp industry.”

“GenCanna is a proud Kentucky-bred business and has a bright future under Andrew’s leadership,” said Matty Mangone Miranda, Founder of GenCanna, who will continue to serve as an advisor to the Company. “Importantly, I would like to thank GCG’s employees, vendors, partners and farmers, as well as MGG, for their support throughout this process.”

Mr. Barnett has spent his career overseeing the strategic, operational and financial needs of private and publicly held companies, from start-up to mature enterprises, in healthcare and wellness, retail, manufacturing, and distribution. He has served in various C-suite roles as well as a consultant to operating company management, lenders and investors. Mr. Barnett holds a BBA from Emory University and attended the New York University Stern School of Business.

Huron Consulting Services LLC has served as operational advisor, Jefferies LLC has served as financial advisor, and Benesch Friedlander Coplan & Aronoff LLP along with Dentons Bingham Greenebaum LLP have served as the Company’s legal counsel.

ABOUT GENCANNA GLOBAL, INC.

GenCanna is a vertically integrated agriculture-technology company specializing in the production of hemp rich in CBD. Committed to helping farmers farm, the GenCanna Certified Farming Network ensures a compliant, consistent supply of hemp-derived products grown on accredited U.S. family farms. GenCanna’s seed-to-shelf chain of custody is built with the industry's strictest compliance standards (BRC, cGMP) and links the farmers directly to the finished goods.

Founded in 2014, as an inaugural member of the Kentucky Department of Agriculture's Industrial Hemp Pilot Program, the company is a longstanding industry pioneer. GenCanna works closely with state universities, consumer protection agencies, and other regulatory bodies driving key industry standards and legislation. Consistent extraction methods and innovative processing technologies ensure GenCanna production processes exceed all regulatory standards for FDA registered and inspected food production facilities (learn more at https://gencanna.com/compliance/). The GenCanna Production Platform™ assures standardized, repeatable quality from farm to finished product.

GenCanna is a founding board member of the U.S. Hemp Roundtable. Launched in early 2017, the U.S. Hemp Roundtable is a coalition of over 70 hemp companies – representing every link of the product chain, from seed to sale – and all of the industry’s major national grassroots organizations. The U.S. Hemp Roundtable has secured the passage of bipartisan legislation in the U.S. Congress that established hemp federally as an agricultural commodity, permanently removing it from regulation as a controlled substance.

ABOUT MGG INVESTMENT GROUP LP

Founded in 2014, MGG Investment Group is a private direct lending investment firm that provides bespoke financing solutions to mid-size and growing lower-middle market companies. MGG works with owners and management teams to help build lasting value, address immediate needs, and solve complex situations while generating attractive risk-adjusted returns for investors irrespective of and through market cycles. For more information, visit www.mgginv.com.

Customer Frequently Asked Questions

  1. What was announced
    • GenCanna has successfully completed the marketing process we have been pursuing since we filed for bankruptcy. The Bankruptcy Court approved a sale of our business to MGG Investment Group and the sale has closed. Under new ownership, operations will continue in Winchester, Ky. The new ownership structure firmly supports the vertically-integrated business model and creates a stronger, better capitalized, and more competitive company with a solid financial foundation.


  2. Who is MGG Investment Group?
    • MGG Investment Group has been GenCanna’s financial partner and has provided funding for our operations since June 2019 as well as provided additional capital following our bankruptcy filing in February 2020.


  3. Do the new owners of GenCanna’s business plan on continuing to do business as usual
    • GenCanna's new ownership is familiar with the hemp and CBD space and will have a hands-on orientation to streamlining all business operations.


  4. Will GenCanna have a secure and consistent supply of Isolate, Broad Spectrum, Full Spectrum?
    • GenCanna's superior 2019 harvest is now coming into full production and we have turned the corner on all product forms. We expect our CBD supply to be unmatched globally.


  5. Will GenCanna’s leadership change?
    • It is expected that new additions to senior management will occur shortly. MGG and GenCanna are in late-stage discussions with potential CEO and senior management candidates consisting of industry leaders to join the new company. However, it is also of great value to the new owners to ensure the critical industry and company knowledge held by our current leadership personnel continues to be available. MGG will continue collaborating with current leadership although titles and roles made be changed, including the possibility of some moving into an advisory or consulting capacity.


  6. Will GenCanna continue to produce finished goods?
    • Yes. GenCanna leads the industry in helping each of its customers to meet their needs for bulk ingredients, specialized formulations, custom labeled/filled packages, or unlabeled QSP products.


  7. If we have made our initial payment for a product and it's not finished before the transaction to new ownership, will we get our finished product or our down payment back?
    • All orders placed before the transition to new ownership will be completed on time and delivered per your agreement, GenCanna will not stop production of any current order.


  8. Will there be any changes to the payment process?
    • You will continue via the current channels during the transition period and we will communicate to you timely of any changes regarding billing and payments.


  9. Is my customer information being sold/safe?
    • GenCanna has never sold, and will never sell, contact information. Privacy and confidentiality are key components to any successful business relationship.


  10. Who will be my Sales contact at GenCanna moving forward?
    Your sales contact will be the same.


  11. What about the recent US Trustee filing on Chapter 7?

    • The US Trustee recently filed a motion to convert our case and we filed our objection. We obtained entry of an order to sell the businesses, and the recent gap in insurance coverage on two small parcels of real estate does not provide grounds for conversion.

MEDIA CONTACT:
For GenCanna
Gary Gerdemann
RunSwitch Public Relations
(502) 291-8557

For MGG Investment Group
Nathaniel Garnick/Sam Fisher
Gasthalter & Co.
(212) 257-4170