Canadian greenhouse produce grower Village Farms International acquired privately held CBD company Balanced Health Botanicals (BHB) in a deal worth $75 million.
Denver-based BHB focuses on hemp-derived CBD products and owns CBD e-commerce platform CBDistillery and CBD skin-care brand Bota.
The CBDistillery website receives more than 30,000 monthly orders and has “a significant repeat customer base,” according to a news release.
The deal will give Village Farms “immediate entry into the U.S. CBD market in a consumer products category adjacent to the high-THC cannabis market, as well as the broader consumer packaged goods wellness arena,” according to a Monday news release.
Vancouver, British Columbia-headquartered Village Farms already owns 100% of Pure Sunfarms, a profitable Canadian cannabis producer.
The $75 million acquisition includes $30 million in cash and $45 million in Village Farms shares.
Village Farms said the deal would be immediately accretive to its net income, with BHB expected to add annualized sales of more than $30 million in 2022.
“Importantly, the addition of the Balanced Health platform provides us with another potential pathway to participate in the U.S. high-THC cannabis market, when permitted to do so,” Village Farms CEO Michael DeGiglio said in the release.
DeGiglio cited Village Farms’ plans “to convert our more than 5.5 million square feet of high-tech greenhouse facilities in West Texas – one of the most favourable environments for cannabis cultivation in the continental U.S. – for large-scale, low-cost production of cannabis.”
Village Farms trades as VFF on the Nasdaq and the Toronto Stock Exchange.