SPAC to acquire four marijuana operations in $210 million deal

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New York-based Greenrose Acquisition Corp., a special purpose acquisition company, entered into definitive agreements to acquire four marijuana businesses in a deal initially valued at $210 million.

The companies to be acquired are Futureworks (doing business as The Health Center), Shango Holdings, Theraplant and True Harvest.

The four companies combined have cannabis operations in seven states: Arizona, California, Colorado, Connecticut, Michigan, Nevada and Oregon.

The deal reflects the increasing popularity of cannabis-focused SPACs and a strengthening of investor sentiment, particularly since Democrats won the presidency and, by slim margins, both chambers of Congress.

Greenrose said the acquisitions will establish a footprint in high-growth, limited-license markets that include new and potential recreational marijuana states.

The companies to be acquired and their operations include:

  • Futureworks/The Health Center: Three cultivation facilities, one processing facility and three dispensaries in Colorado with a focus on the Denver metro area.
  • Shango: Operations in Arizona, California, Michigan, Nevada and Oregon. The Nevada and Oregon companies are vertical operations.
  • Theraplant: One of only four cultivators in Connecticut. The company also has a processing and packaging facility in Connecticut.
  • True Harvest: Cultivation and processing facility in Arizona. Known as a premium craft producer.

The $210 million deal will include about $170 million in cash, $15 million in stock and $25 million in debt, according to a Greenrose news release.

Greenrose, which previously raised $150 million, said it intends to conduct an additional $150 million private offering of securities and debt for the acquisition and general corporate purposes.

According to the release, the company will be renamed The Greenrose Holding Co. and expects to transition its stock listing from the Nasdaq (GNRS) to the U.S. over-the-counter markets.

Greenrose also will list its stock on the Canadian NEO Exchange.