Massachusetts-based multistate marijuana operator Curaleaf Holdings plans to grow its footprint in the Colorado cannabis market by acquiring the cultivation and retail assets of Pueblo, Colorado-based Los Sueños Farms.
The proposed acquisition is worth $67 million, 61% of which will be paid in Curaleaf subordinate voting shares, 29% in cash at closing and 10% in assumed debt.
A contingent payment worth another $8 million “will be paid based upon operating cash flow-based targets for 2022,” Curaleaf said in a Monday news release.
Curaleaf first entered the Colorado market in 2020 when it purchased Denver-based edibles producer BlueKudu.
The Los Sueños acquisition includes three outdoor cannabis cultivation sites in Pueblo totaling 66 acres, an indoor cultivation facility and two adult-use retail stores.
“The acquisition of Los Sueños will add over 50,000 pounds per year of low-cost wholesale capacity to Curaleaf’s footprint in Colorado, which we intend to double to over 100,000 pounds, representing a significant market share,” Curaleaf CEO Joseph Bayern said in a statement.
The new production capacity will also “fuel the further deployment” of Curaleaf’s Select brand of cannabis products, which is already available at 230 Colorado retailers, Bayern added.
“Ultimately, our goal is to cultivate cannabis at less than $100 per pound, and this acquisition is a significant step in the right direction,” Curaleaf Executive Chair Boris Jordan in a statement.
Los Sueños was poised to be acquired by Denver-based Schwazze in 2020, but the deal fell apart last July.