Curaleaf Holdings, Inc. (OTCQX: CURLF) closed on its previously announced acquisition of GR Companies, Inc. also known as Grassroots on July 23, 2020. Curaleaf stock was higher by almost 3% to $7.39 on the news as it has been almost a year since it was first announced. The stock is nearing its year high of $8.21.
The acquisition of Grassroots now propels Curaleaf to the top of the charts for cannabis companies by revenue. The company will now have affiliated operations that cover over 135 dispensary licenses, 88 operational dispensary locations, over 30 processing facilities, and 22 cultivation sites with 1.6 million square feet of current cultivation capacity. It also jumpstarts the company’s presence in the hot states of Illinois and Pennsylvania.
“The successful acquisition of Grassroots marks Curaleaf’s expansion into new vertically integrated markets in the Midwest, firmly establishing our U.S. market leadership position. This highly complementary combination brings together two companies with a shared vision for enhancing patients’ and customers’ lives with high-quality cannabis wellness and lifestyle products,” said Joseph Lusardi, CEO of Curaleaf. “The integration of Grassroots is expected to be immediately accretive to our financial performance, with our unprecedented scale providing significant opportunities to leverage Curaleaf’s powerful consumer brands as well as new form factor innovations across our expanded national presence.”
The company said in a statement that the cultivation and processing assets in Illinois have been transferred and the formal approval to transfer certain retail assets is expected imminently. Plus, Maryland operations previously affiliated with Grassroots may be transferred to Curaleaf after expiration of the statutory hold period, subject to regulatory approval and compliance with restrictions on ownership or control of multiple cultivations, processor, and dispensary licenses in the State.
Completion of the transaction accelerates Curaleaf’s expansion into Illinois and Pennsylvania, which are among the largest and fastest-growing cannabis markets in the United States. Curaleaf will now hold a leading licensed cannabis presence in-state markets including Arizona, Connecticut, Florida, Illinois, Pennsylvania, Maryland, Massachusetts, Maine, Nevada, New Jersey, New York, North Dakota, and Vermont.
“This opportunity would not have come to fruition without the strength of our highly skilled executive team, who have built an impressive portfolio at an unprecedented pace, with facilities in highly competitive markets,” said Mitchell Kahn, Co-Founder, and CEO of Grassroots. “We look forward to integrating our talent and resources to build a great consumer product company – one that is dedicated to producing and delivering high-quality, safe, and effective cannabis products to the customer.”
Curaleaf Announces New Board Member
Curaleaf also announced it appointed Kahn to the company’s Board of Directors effective immediately. The appointment of Mr. Kahn expands the Curaleaf Board of Directors from five to six members.
“On behalf of the Curaleaf Board of Directors and management team, we are pleased to welcome Mitch to the Board. As a co-founder of Grassroots, he brings an impressive track record for success in building the largest private, vertically integrated U.S. multi-state cannabis operator. Combined with his deep experience across commercial real estate as well as the legal field, Mitch adds significant expertise and insight that will be vital as we extend our market leadership position and drive long-term shareholder value,” said Boris Jordan, Executive Chairman of Curaleaf.