StockNews.AI
SMG
StockNews.AI
131 days

ScottsMiracle-Gro Continues to Advance Consumer and Cannabis Strategies

1. ScottsMiracle-Gro transferred The Hawthorne Collective to an independent partner. 2. This move focuses on core lawn and garden business growth. 3. Transaction aims to reduce cannabis sector volatility on the stock. 4. Future plans to separate The Hawthorne Gardening Company by fiscal 2025. 5. Promissory note received, with an option to reacquire The Hawthorne Collective.

5m saved
Insight
Article

FAQ

Why Bullish?

The strategy to focus on core business reduces volatility risks related to cannabis, aligning with shareholder interests. Historical examples indicate separating high-risk ventures can stabilize stock performance, as seen with companies like Philip Morris in tobacco.

How important is it?

The transfer indicates strategic realignment away from cannabis, mitigating risk and enhancing focus on existing strong brands. Stakeholders may favor this restructuring as a better strategy for steady growth.

Why Long Term?

The separation may lead to sustained revenue growth in the lawn and garden sector, with lasting effects beyond immediate financial quarters. Long-term focus on core operations often results in improved investor confidence and stock performance, similar to trends observed in consumer staples.

Related Companies

CANSTRULCURA
Transfer of Hawthorne Collective reflects focus on separating cannabis holdings and driving greater growth in core lawn and garden business April 10, 2025 16:05 ET  | Source: Scotts Miracle-Gro Company (The) MARYSVILLE, Ohio, April 10, 2025 (GLOBE NEWSWIRE) -- The Scotts Miracle-Gro Company (NYSE: SMG), the world’s leading marketer of branded consumer lawn and garden products as well as a leader in indoor and hydroponic growing products, today announced the transfer of its wholly-owned subsidiary, The Hawthorne Collective, Inc., to an independent strategic partner. The Company created The Hawthorne Collective in 2021 as a vehicle to invest in areas of the cannabis industry that are not pursued by its Hawthorne Gardening Company subsidiary, a leader in cultivation supplies such as lighting, nutrients and other materials for cannabis growers and hydroponic cultivators. Included within The Hawthorne Collective’s holdings are investments in Fluent, previously Cansortium, a vertically integrated cannabis company with licenses and operations in Florida, Pennsylvania, Texas and New York. “The Hawthorne Collective transaction is the initial step in our plan to move our cannabis-adjacent subsidiaries into a separate and independent company as we further our strategic focus on our core lawn and garden business,” said Jim Hagedorn, chairman and CEO of ScottsMiracle-Gro. “For our shareholders, this will reduce the impact of the cannabis sector’s volatility on our Company’s stock and provide opportunities to drive meaningful and immediate value creation through increased investments in our consumer business. As we further advance this plan, we next will look to separate The Hawthorne Gardening Company from ScottsMiracle-Gro by the close of fiscal 2025. “The Hawthorne companies were intended to capitalize on the legal cannabis sector, but the ability to achieve sustained growth within this industry has been challenged by four years of unkept promises resulting in total inaction at the federal level on cannabis-related issues. President Trump has supported a range of much-needed reforms, from rescheduling cannabis to adoption of the SAFER Banking Act. The actions he has endorsed would accelerate industry growth and increase the value of these investments. Until they become a reality, we believe the Hawthorne companies can be a greater asset within an independent cannabis-dedicated entity, specifically one in which our cultivation supply business can partner with a multi-state operator or leading cannabis brands.” Under terms of the deal, ScottsMiracle-Gro transferred The Hawthorne Collective to the strategic partner in exchange for an interest-bearing promissory note. The Company retains an option to reacquire The Hawthorne Collective or its assets should cannabis legalization and other measures to positively impact the industry be approved at the federal level. About ScottsMiracle-GroWith approximately $3.6 billion in sales, the Company is the world’s largest marketer of branded consumer products for lawn and garden care. The Company’s brands are among the most recognized in the industry. The Company’s Scotts®, Miracle-Gro®, and Ortho® brands are market-leading in their categories. The Company’s wholly-owned subsidiary, The Hawthorne Gardening Company, is a leading provider of nutrients, lighting and other materials used in the indoor and hydroponic growing segment. For additional information, visit us at www.scottsmiraclegro.com. For investor inquiries: Brad CheltonVice PresidentTreasury, Tax and Investor Relationsbrad.chelton@scotts.com(937) 309-2503 For media inquiries: Tom MatthewsChief Communications Officertom.matthews@scotts.com(937) 844-3864

Related News