Cannabis MSO Verano eyes lucrative markets with $413 million acquisition

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Verano Holdings signed a definitive agreement to acquire Goodness Growth Holdings for roughly $413 million, a move that will enable the cannabis multistate operator to expand into Minnesota, New York and New Mexico.

The deal, which also includes operations in Arizona and Maryland, positions Chicago-based Verano for several new and emerging recreational marijuana markets.

New York and New Mexico legalized recreational marijuana last year, Maryland is a leading candidate to do so in the next couple of years, and Arizona launched sales in January 2021.

Goodness Growth, formerly Vireo Health, entered the Maryland medical marijuana market last year via acquisition.

Under the terms of the agreement, Verano will issue 0.22652 shares for each Goodness Growth share and 22.652 shares for each Goodness Growth super voting share.

When the acquisition is completed, Verano’s operational footprint will span 15 states and include 1.3 million square feet of cultivation capacity as well as 111 retail outlets.

Verano will acquire the following operations in the Goodness Growth deal, according to a news release:

  • One of only 10 vertically integrated medical marijuana licenses in New York. The operation includes a cultivation license, four operating dispensaries and four planned storefronts.
  • One of only two vertically integrated MMJ licenses in Minnesota. The operation includes a cultivation facility and eight working dispensaries.
  • Four medical marijuana dispensaries in New Mexico and an 18,650-square-foot cultivation facility.
  • Two MMJ dispensaries in Maryland and a 143,500-square-foot greenhouse.
  • An 18-acre cultivation facility in Arizona.

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Verano acquired Florida-based Alternative Medical Enterprises (AltMed) a year ago in a deal that made Verano one of the largest multistate marijuana operators.

After Verano completes the Goodness Growth deal, Minnesota will become a battleground between two Illinois multistate operators.

Chicago-based Green Thumb Industries bought the other medical cannabis license in Minnesota in December from LeafLine Industries for an undisclosed price.

The Goodness Growth transaction is subject to regulatory, shareholder and other approvals.