Safe haven to buy cannabis bank, payment fintech
Cannabis banking services provider Safe Harbor Financial has set its sights on its first acquisition target since going public in September – cannabis banking and payments platform Rockview Digital Solutions Inc., also known as Abaca.
The two companies announced Monday a $30 million cash-and-stock deal that is expected to close this quarter.
The deal will add 300 accounts to Safe Harbor’s portfolio and expand the firm’s operations to more than 30 states. The acquisition will also allow Safe Harbor to offer desktop and mobile banking services, treasury management, payment processing, cash handling and logistics to its banking customers, the companies said.
Since going public via a special purpose acquisition company (SPAC) deal last month, Safe Harbor founder and CEO Sundie Seefried has expressed a desire to use strategic acquisitions to grow the firm into a “one-stop financial services provider to the cannabis industry.”
“[W]With this access to the capital markets now, we can really serve the cannabis industry with the reliable services that they need,” Seefried told Banking Dive last month.
Abaca helps FDIC-insured banks provide traditional banking services to cannabis dispensaries by helping them manage regulatory risk at scale. The firm claims it has processed more than $3 billion in gross transactions since its launch in 2017.
Following the closing of the transaction, which is subject to regulatory approvals and other customary closing conditions, Safe Harbor said it expects to launch a payroll service this quarter.
“With their cannabis banking and financial platform ecosystem, proprietary technology, strong financial institution and banking relationships, and experienced founder-led management team, we believe Abaca is the ideal platform to help us take a major step forward in scaling our capabilities and service offerings in building the complete fintech ecosystem for cannabis,” Seefried said in a statement on Monday.
Safe Harbor was established in 2015 as the cannabis banking arm of Partner Colorado Credit Union and was spanned off from the credit union last year.
Seefried left his role as CEO of the Arvada, Colo.-based credit union to focus solely on expanding its cannabis banking venture.
Since its inception, the cannabis banking services provider, which has operations in 20 states, said it has helped take in more than $12 billion in customer deposit transactions.
Safe Harbor has expanded its executive suite since going public, tapping former Hypur Chief Business Development Officer Tyler Beuerlein as its head of strategic business development in April.
The company’s proposed acquisition of Abaca will further expand Safe Harbor’s management team.
Abaca co-founder and CEO Dan Roda will become executive vice president and CEO of Safe Harbor, and Abaca co-founder and president Brian Bauer will serve as chief revenue officer once the deal closes, the companies said.
