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Harvest Health & Recreation Buys Verano Holdings In $850M All-Stock Deal

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Harvest Health & Recreation Buys Verano Holdings In $850M All-Stock Deal
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Vertically integrated cannabis company Harvest Health & Recreation Inc (OTC: HRVSF) said Monday it will acquire Chicago-based peer Verano Holdings in an all-stock deal worth $850 million. This is the second acquisition announced by Harvest Health & Recreation in the last month.

Verano, Harvest Health CEO Steve White and many others will be at The Cannabis Capital Conference, which returns to Toronto April 17-18!

What Happened

The acquisition will create one of the largest multistate operators in the country, with Harvest controlling licenses to operate up to 200 facilities in 16 states, including 123 dispensaries. 

Verano was launched in October foollowing the consolidation of four companies: Ataraxia, Zen Leaf, Verano and 3 Boys Farms. At the time of the launch, Verano received $120 million in financing. 

The Verano purchase gives Harvest licenses and operations in 11 states and territories, including seven cultivation licenses and 37 retail licenses. It will also access a portfolio of premium brands that include more than 150 product SKUs sold in more than 150 retail locations. 

Why It's Important

Verano Holdings is Harvest Health & Recreation's second acquisition in less than a month. In February, the company said it would buy California-based Falcon International Corp., expanding its footprint by 16 cannabis licenses.

The latest deal shows that the U.S. cannabis industry is undergoing a wave of consolidation. Given the heightened competition for licenses in states that have recently legalized cannabis, acquisitions allow MSOs to expand and establish a foothold in new markets. 

What's Next

The closing of the transaction is subject to the negotiation of a definitive agreement and the approval of shareholders from both companies — as well as regulators and the Canadian Securities Exchange. Harvest said it expects the acquisition to close in the first half of 2019. The company also anticipates continued growth in 2020. 

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Read more about our latest Cannabis News! CANNABIS HOME

Posted-In: Cannabis M&A Harvest Health & Recreation marijuana MSOsCannabis M&A News Markets Best of Benzinga

 

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