BOCA RATON, FL - Greenlane Holdings, Inc. (NASDAQ:GNLN), a global distributor of premium cannabis accessories and vaporization products, announced a multi-year distribution partnership with Veriteque USA, Inc., the producer of SwabTek™ and Verifique™ brand field test kits. The agreement will enable Greenlane to distribute Veriteque's suite of single-use tests for narcotics, explosives, and other substances across the U.S., targeting institutional retail, education, law enforcement, and corporate sectors.
Veriteque's manufacturing capabilities in San Diego, CA, allow for the production of hundreds of thousands of tests daily. The company's products are already supplied to well-known retailers like Walgreens and Rite Aid (NYSE:US90274J5618=UBSS), numerous U.S. schools, over 100 European Union airports, and a wide array of law enforcement agencies worldwide.
The SwabTek™ and Verifique™ test kits are touted for their simplicity and instant results, using a dry paper and swab format to collect samples from any surface. The paper-based tests also emphasize a limited environmental impact.
Barbara Sher, CEO of Greenlane, emphasized the distribution relationship with Veriteque as a commitment to community safety, noting the tests' ability to provide quick insights for taking appropriate action in various settings. Bobby Betros, CEO of Veriteque USA, echoed the sentiment, highlighting Greenlane's shared focus on community safety and wellness.
Greenlane, founded in 2005, has established itself as a notable platform for the development and distribution of lifestyle products, operating a family of brands and an omnichannel distribution network. Their portfolio includes exclusive licensed products and a curated selection of third-party items sold through direct sales channels and e-commerce platforms.
This distribution agreement is based on a press release statement and contains forward-looking statements regarding the collaboration's future impact on Greenlane's business operations. However, these statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those projected.
In other recent news, Greenlane Holdings has entered into an exclusive distribution agreement with Safety Strips Tech Corp. for their substance detection test strips, a move aimed at addressing the ongoing opioid crisis. The company has also announced a debt restructuring strategy, reducing its debt by approximately $617,000 and extending its maturity. In a separate development, Greenlane has signed a non-binding letter of intent to distribute CURB Lifestyle's patented inhalation device across various markets.
These recent developments also include Greenlane issuing a $3.2 million convertible note to Cobra Alternative Strategies, providing immediate capital with the potential for equity conversion. CEO Barbara Sher demonstrated her confidence in the company's future by purchasing 12,500 common shares. To meet Nasdaq's minimum bid price requirement, Greenlane announced a one-for-11 reverse stock split of its Class A common stock.
In addition, Greenlane plans to raise $6.5 million for working capital and general corporate purposes by issuing over 2.3 million units, with Aegis Capital Corp. as the exclusive placement agent. Lastly, Greenlane successfully reduced its U.S. vendor accounts payable by nearly $4.4 million, enhancing its financial position.
InvestingPro Insights
As Greenlane Holdings, Inc. (NASDAQ:GNLN) embarks on this new distribution partnership with Veriteque USA, Inc., it's crucial to examine the company's financial health and market performance. According to InvestingPro data, Greenlane's market capitalization stands at a modest $1.12 million, reflecting its current position in the market.
The company's revenue for the last twelve months as of Q3 2024 was $21.61 million, with a significant revenue decline of 72.06% over the same period. This substantial drop in revenue underscores the importance of new partnerships and distribution channels, such as the one with Veriteque, to potentially reverse this trend.
InvestingPro Tips highlight that Greenlane is "Trading at a low Price / Book multiple" of 0.12, which could indicate that the stock is undervalued. However, this should be considered alongside the fact that the company is "Not profitable over the last twelve months" and is "Quickly burning through cash." These factors suggest that while the new partnership may open up opportunities, Greenlane faces significant financial challenges that investors should carefully consider.
It's worth noting that InvestingPro offers 16 additional tips for Greenlane, providing a more comprehensive analysis for those seeking deeper insights into the company's financial situation and market prospects.
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