Canadian acquisition company to purchase five US cannabis firms

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Toronto-based Cannabis Strategies Acquisition Corp. (CSAC) has inked a deal to acquire five U.S. cannabis firms, with plans to combine the operations.

CSAC – a special purpose acquisition company that is listed in Canada (CSA/A:CN) – will pay a total of 99 million Canadian dollars ($76 million) in cash for the five companies, with plans to issue to shareholders about 7.6 million shares and promissory notes worth CA$57 million.

Under the agreement, the company will acquire:

  • Nevada-based Washoe Wellness, a cannabis cultivator, producer and distributor with operations in Reno and distribution to Las Vegas.
  • LivFree Wellness, also based in Nevada, with three dispensary operations and four cultivation facilities across the state.
  • Nevada-based The Canopy NV, which has two dispensaries – one in downtown Reno and another in the Reno suburb North Valleys.
  • Massachusetts-based Sira Naturals, a cannabis cultivator and with three dispensaries across the state.
  • CannaPunch of Nevada, a cannabis producer with operations in Nevada and Colorado.

Combined revenues for the five firms – which are all licensed for medical and adult-use operations – is projected to be CA$261 million in 2019, according to a news release.

Once the deal closes, CSAC will own three cultivation and production facilities, a center dedicated to cannabis goods manufacturing and eight dispensaries on the West and East coasts.

The transaction is slated to close in the first quarter of 2019.