Columbia Care Does C$130 Million Deal Following Buying Binge

After a slew of acquisitions, Columbia Care Inc. (OTCQX: CCHWF) entered into an agreement with Canaccord Genuity Corp. on a bought deal for 16,150,000 common shares at a price of C$8.05 per share for aggregate gross proceeds of C$130,007,500. The closing is expected to occur on or about January 13, 2021. The net proceeds will be used for working capital and general corporate purposes.

Acquisitions

Over the past few months, Columbia Care has been on a buying binge. Yesterday the company announced it was buying California-based dispensary The Healing Center San Diego (THCSD) for approximately $15.0 million. The deal consists of $3.0 million in cash, $6.0 million in Columbia Care stock, and $6.0 million in seller promissory notes. The company said in a statement that excluding any revenue or margin synergies, the purchase price represents approximately 1.2x and 4.7x estimated 2021 revenue and Adjusted EBITDA, respectively.

Earlier in December Columbia signed a definitive agreement to acquire Green Leaf Medical, LLC which is a privately held, fully-integrated cannabis multi-state operator (MSO) based in the mid-Atlantic region, for approximately $240 million with the potential for additional performance-based milestone payments. Green Leaf is one of the largest private MSOs in the United States and a market leader in the mid-Atlantic region with cultivation, extraction, processing, and retail operations across its four-state footprint. In addition to its dispensary footprint, Green Leaf also brings a leading wholesale market position in both Pennsylvania and Maryland, where its products are most widely sold under its nationally recognized gLeaf brand, including extracts and pre-rolls.

At the time CEO Nicholas Vita said, “This combination affirms Columbia Care’s position as one of the largest cultivators, manufacturers, and retailers in four key states – PA, VA, OH and MD – three of which are expected to convert from medical to adult use in the next 24 months. Green Leaf complements our retail footprint and brings wholesale leadership through which we can drive our portfolio of brands and unique products. The transaction is immediately accretive to gross margin, Adjusted EBITDA and Cash Flow from Operations. Ohio and Pennsylvania are already two of our top-performing markets by revenue and Adjusted EBITDA, and this transaction makes us one of the largest, most scaled wholesale and retail operators. In Maryland and Virginia, Green Leaf materially expands our wholesale footprint, retail dispensary network and the scope of our home delivery services. Acquiring Green Leaf immediately converts Maryland to an Adjusted EBITDA positive market. In addition, it accelerates our growth and profitability in Virginia, Ohio and Pennsylvania. No organization in the industry will be better positioned to serve patients and customers in the mid-Atlantic than Columbia Care.”

This was also at the same time Columbia closed its acquisition of Project Cannabis, a leading cannabis cultivator, wholesaler, and retailer based in Los Angeles, California. Total transaction consideration included approximately $52.5 million in Columbia Care stock and additional consideration of $16.5 million anticipated to be paid to the sellers from the proceeds of a subsequent sale of Project Cannabis’ real estate assets.

Debra Borchardt

Debra BorchardtDebra Borchardt

Debra Borchardt is the CEO, Co-Founder, and Editor-In-Chief of GMR. She has covered the cannabis industry for several years at Forbes, Seeking Alpha and TheStreet. Prior to becoming a financial journalist, Debra was a Vice President at Bear Stearns where she held a Series 7 and Registered Investment Advisor license. Debra has a Masters degree in Business Journalism from New York University.


Leave a Reply

Your email address will not be published. Required fields are marked *


About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


READ MORE



Recent Tweets

@GreenMarketRpt – 2 days

If you missed any news this week, then give a quick watch

@GreenMarketRpt – 2 days

We did it! We made it to Friday. FWIW the mercer story broke long after we shot and edited this weekly recap.

Back to Top

You have Successfully Subscribed!