Vireo Sells Pennsylvania Facilities to Jushi for $37M

Florida-based Jushi Inc. is set to acquire Vireo Health International’s cultivation-processor facilities in Pennsylvania in a $37 million deal.

Full story after the jump.

Jushi Inc., a Florida-based, multi-state, cannabis company, is set to acquire Vireo Health International’s cultivation-processor facilities in Pennsylvania for $37 million. The company, Pennsylvania Medical Solutions, holds cultivation and processor licenses in Pennsylvania which would be included in the deal pending regulator approval.

Vireo founder and CEO Dr. Kyle Kingsley said the deal “secures Vireo’s capital position for the foreseeable future” and will enable the company to “comfortably execute” its fiscal year 2020 strategy, “and begin generating positive cash flow in the first half of next year without requiring any additional capital infusions.”

“We’re especially pleased to achieve this milestone for shareholders without the dilutive impacts of other forms of financing, and we’re also very excited about the opportunities in front of us to re-invest a portion of these proceeds to increase scale in select markets where we see significant opportunities to improve revenue growth and future cash flow generation.” – Kingsley in a statement

The company indicated a portion of the proceeds of the transaction would be used “for capital expenditures that will increase scale in its core markets of New York, Minnesota, Maryland, Arizona, and New Mexico.”

Of the $37 million, $16.3 million is in cash, while $3.8 million is in the form of a four-year note with an 8 percent coupon rate payable quarterly, and $17 million is in right of use liabilities associated with long-term lease obligations. The deal also includes an 18-month option for Jushi to purchase equity in Pennsylvania Dispensary Solutions, LLC – another Vireo subsidiary – for an additional $5 million in cash.

Jushi secured $15.25 million in debt financing for the purchase, led by insiders and existing shareholders, the company said in a press release.

While based in Florida, Jushi does not have any operations in the state. It lists its active and in-progress operations in California, Nevada, Illinois, Ohio, Virginia, and New York.

Get daily cannabis business news updates. Subscribe

Have an additional perspective to share? Send us a message to let us know, and if your comment is chosen by our editors it could be featured here.


Latest Cannabis News

View all news Get email updates

Create a profile View all categories

From Our Partners