Cannabis MSO Verano makes $175M expansion move in Pennsylvania

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Acquisition activity in Pennsylvania continues at a brisk pace, with Illinois-based Verano Holdings making a big move to add marijuana cultivation and retail capacity in the state through two deals totaling more than $170 million.

The multistate operator said Thursday it signed definitive agreements to acquire a large cultivation facility as well as an equity interest in six dispensaries and an additional growing facility.

The two transactions total $175.5 million in cash and stock, excluding possible future payments.

Verano’s deals reflect the latest of a wave of acquisitions in Pennsylvania, which has a robust medical cannabis program and is eyeing adult-use legalization.

TerrAscend and Trulieve both announced roughly $60 million acquisition deals in Pennsylvania this month, and Jushi Holdings received a $30 million infusion to expand a cultivation facility in the state.

Verano also announced a deal in March to acquire three MMJ dispensaries in the Pittsburgh area.

The latest transactions break down like this:

  • Verano agreed to acquire all of the outstanding equity interests in both Agri-Kind, which has a 62,000 square-foot cultivation and processing facility, as well as Agronomed Holdings. That deal is for $66 million in cash and $49.5 million in stock. There also is an earnout provision where the seller could make up to $31.5 million based on the future performance of the business. Agri-Kind’s management team is expected to remain in place.
  • Verano also agreed to purchase all the outstanding equity interest in Agronomed Biologics, a research joint venture between Agronomed Pharmaceuticals and The Healing Center. The deal is for $60 million in cash and stock, in addition to earnouts and other adjustments. Agronomed has one of the state’s approved research licenses in partnership with Drexel University College of Medicine. It is permitted to open a cultivation and processing facility and operate up to six MMJ dispensaries.

The transactions are subject to regulatory approvals and other closing conditions.

Verano has active marijuana operations in 11 states, and operates dispensaries under the retail brands Zen Leaf and MüV.