Multistate marijuana operator Acreage Holdings said it has closed on a deal to acquire a New Jersey medical cannabis operation for $10 million, plus the assumption of debt.
The acquisition, announced last year, gives Acreage a firm foothold in a marijuana market positioned for potential adult-use legalization. New Jersey residents will vote on an adult-use initiative in November.
Acreage’s acquisition of Compassionate Care Foundation includes licenses for cultivation, processing and three dispensaries.
Acreage said it currently has licenses to operate two other New Jersey dispensaries – one in Egg Harbor and another on the Atlantic City Boardwalk. The company operates under The Botanist brand.
The closing of the New Jersey deal comes just a few days after Canadian cannabis producer Canopy Growth reached an agreement to amend its acquisition of Acreage and slash the values of the deal from $3.4 billion to about $900 million. The price cut reflects the cannabis stock slide and Acreage’s financial condition.
Reflecting a cash-strapped status, New York-based Acreage recently secured a short-term loan for $15 million with an interest rate of 60%.
Acreage’s revenues in the first quarter of this year totaled $24.2 million, up 15% from the previous quarter, but the company has yet to break even on its operations.