Mergers & Acquisitions
The largest hidden risk in a cannabis acquisition is inherited tax exposure, and it does not appear on the balance sheet.
Cannabis M&A carries risks that do not appear in other industries: undisclosed 280E liability, licenses that may not transfer, and inventory valued on a basis the buyer cannot verify.
We work both sides, and we have seen where deals go wrong.
What's Included
Why This Differs In Cannabis
The single largest hidden risk in a cannabis acquisition is inherited tax exposure. A target with aggressive or undocumented 280E positions carries a contingent liability that may exceed the purchase price, and it does not show up on the balance sheet. Buyers who skip this analysis find it later.
Structure matters more here too. Whether the deal is an asset purchase or an equity purchase determines whether that historical exposure follows you — and in many states, license transfer rules constrain which structures are even available.
A contingent liability that may exceed the purchase price, invisible on the balance sheet.
Why MCA
We have served licensed cannabis operators since 2015 — one of the first firms in the country to build a practice around it — and we have worked with more than 100 operators across 30+ states. Cannabis is all we do, and all we have ever done.
Frequently Asked
We are selling. When should we start?
Twelve months out if possible. Cleaning up the financial picture takes time and directly affects price.
We are buying. What is the biggest risk?
Undisclosed prior-year tax exposure, consistently.
Do you find buyers or sellers?
No, we are the financial side. We can refer brokers.