New York-based multi-state cannabis operator Columbia Care Inc announced on Tuesday a deal to acquire Colorado’s Medicine Man Denver for $42 million in cash and stock. Medicine Man last year outperformed the broader Colorado market with sales growth of 42% compared to 24% for the state and 64% year-to-year through May versus 24% for the state, Columbia said in a press release.
The acquisition will add three adult-use dispensaries, one facility that serves both medical and adult-use clients, and a 35,000-square-foot cultivation facility that produces three million grams of flower annually.
Nicholas Vita, CEO of Columbia Care, said the deal “will further cement” the company’s “position as the leading vertically integrated operator in Colorado.”
In 2019, Columbia announced it would acquire The Green Solution for $140 million. Vita said that the Medicine Man acquisition “in tandem with [the] ongoing integration of The Green Solution … will have a positive impact on [Columbia’s] financial performance for years to come.”
Medicine Man President and Co-founder Andy Williams said that the cannabis industry “is changing and growing now faster than ever” and that the company recognizes “the need to partner with others in order to continue to compete within, and help to responsibly transform, the industry as it grows.”
$8.4 million of the deal’s considerations will be paid in cash with $33.6 million in stock. A potential milestone payment is included next year if certain performance targets are met. The transaction is expected to close in the fourth quarter of this year.
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