Canada-based C21 Investments continued its blistering U.S. acquisition pace, announcing Monday it is acquiring Oregon’s Grön Chocolate in a deal worth up to $11.2 million.
C21 CEO Robert Cheney said in a news release that adding the upscale edibles maker is a critical addition to the vertically integrated MJ company’s strategy to aggressively compete in the multibillion-dollar U.S. cannabis market.
This is the sixth acquisition agreement announced by C21 in the past year. Other agreements include Silver State Relief in Nevada as well as Oregon MJ businesses Phantom Farms, Swell Companies and Eco Firma Farms.
Christine Smith, Grön’s founder and CEO, said in a statement that C21 has agreed to invest the capital required to expand Grön’s brand into other markets. Grön had been targeting California and Nevada for expansion.
C21 has agreed to pay Grön unit holders $6.8 million plus shares equivalent to $4.4 million through a so-called “earnout” provision that is dependent on unspecified targets being met.
The purchase price, according to a news release, will be settled by:
- A cash payment upon closing.
- Promissory notes entitling Grön, after 24 months, the option to convert the principal into C21 common shares, or redeem the cash value.
- An option to convert promissory notes into C21 common shares over a two-year period.
Smith founded Grön, the Swedish word for green, in 2014.
The company has two licensed manufacturing facilities totaling more than 7,000 square feet as well as a small retail/tasting room.
C21 trades on the Canadian Securities Exchange under the ticker symbol CXXI.