Massachusetts-based cannabis multi-state operator Curaleaf on Monday agreed to acquire Tryke Companies, which operates in Arizona, Nevada, and Utah, for $286 million. The cash and stock deal is expected to close in the second half of next year, following regulatory approvals.
In a statement, Curaleaf Founder and Chairman Boris Johnson said the deal would expand the company’s U.S. presence into the three western states where Tryke operates “while yielding meaningful benefits” to Curaleaf stakeholders. Tryke owns and operates two retail dispensaries in Arizona and four in Nevada under the Reef brand. The company’s brands are sold in over 50 locations throughout the company’s operating footprint.
Under the terms of the agreement, Curaleaf will pay $40 million in cash at closing, with the remaining $75 million in cash paid in equal installments on the first, second, and third anniversaries of the closing. The stock portion of the transaction consists of 17 million subordinate voting shares of Curaleaf and will also be paid in three equal installments on the three anniversaries of the closing. An incremental earnout of up to 1 million Curaleaf shares may be paid in 2023 based on the business exceeding certain EBITDA targets for the previous year.
In a press release, the companies note that Tryke has “compelling” EBITDA margins in excess of 35% and is expected to record nearly $110 million in full-year 2021 revenue.
Last month, Curaleaf completed its acquisition of Los Sueños Farms, the largest outdoor cultivation operation in Colorado, in a $67 million deal.
Last March, Curaleaf announced it would acquire EMMAC Life Sciences Ltd., Europe’s largest vertically integrated cannabis company, for approximately $286 million.
The Tryke deal still requires the approval of the Nevada Cannabis Compliance Board.
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