Ayr Wellness Debuts In New Jersey Via $101M Acquisition Of Garden State Cannabis Dispensary

Vertically integrated cannabis company Ayr Wellness Inc. AYR AYRWF has wrapped up the previously announced acquisition of GSD NJ, LLC, which is doing business as Garden State Dispensary.

Deal Details

The Canadian company bought 100% of the New Jersey-based licensed operator's equity interests for $101 million, including $41 million in cash, $30 million in exchangeable shares and $30 million in the form of a promissory note.

In addition, earnout payments are subject to particular target revenue milestones upon closing of the deal and are capped at $97 million.

The New Jersey Cannabis Regulatory Commission approved CSAC Acquisition NJ Corp., a wholly-owned Ayr subsidiary, to acquire 100% of the membership interests in Garden State Dispensary during its meeting on September 14, nearly a year following the first announcement.

What Does It Mean For Ayr Wellness?

GSD is one of the 12 existing vertical permit holders and six original alternative treatment centers in the Garden State.

The company currently employs 110 people and has three operating dispensaries, in addition to roughly 30,000 sq. ft. of operational cultivation and production facilities. An additional 75,000 sq. ft. of cultivation is under construction.

"We are thrilled to be welcoming Garden State Dispensary to the Ayr team and for the opportunity to serve the New Jersey cannabis marketplace," Jonathan Sandelman, the company's founder, CEO, and chairman said Wednesday. "New Jersey presents a tremendous opportunity for Ayr, with high population density, a noted demand for cannabis, a disciplined license structure, and adult-use sales rapidly approaching."

What's Next?

Sandelman expects to introduce Ayr's cannabis products, including brands such as Origyn Extracts and Kynd premium flower in New Jersey.

Earlier this month, the Miami-based company revealed its plans to acquire Cultivauna, LLC, the owner of Levia branded cannabis-infused seltzers and water-soluble tinctures and PA Natural Medicine, LLC, which is an operator of three licensed retail dispensaries, thereby deepening its presence in the Pennsylvania medical market.

Price Action

Ayr Wellness' shares traded 4.13% higher at $22.7 per share after market close on Wednesday.

Photo: Courtesy of Scott Graham on Unsplash