Vireo closes $4 million purchase of Nevada cannabis production facilities

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Cannabis multistate operator Vireo Health said it has finally closed on a 2018 deal valued at $4 million to purchase four Nevada marijuana production licenses.

According to a news release, the permits are only for cultivation and manufacturing and won’t allow Minnesota-based Vireo to enter the retail side of the Nevada cannabis market.

Still, it gives Vireo a seventh state presence to add to its portfolio.

The company, which launched first in Minnesota, also has marijuana business holdings in Arizona, Maryland, Massachusetts, New Mexico and New York.

Though the release announcing the closing didn’t disclose terms of the deal, the purchase price was outlined in Vireo’s listing statement when it went public in 2019.

Under terms of the deal, Vireo agreed to pay nonrefundable deposits of $550,000 to the two companies that owned the four permits. The deal calls for total payments of $1.5 million in cash and $2.5 million in convertible debt instruments.

Though the four facilities are not yet operational, Vireo expects they will be before long.

“The existing 4,950 square feet structure is ready to begin production in the near future, and we expect to begin development of up to 10 acres of additional indoor and outdoor cultivation over the course of the next year which will enable us to serve the Nevada market as a low-cost supplier of premium products,” Vireo CEO Kyle Kingsley said in the release.

Vireo trades on the Canadian Securities Exchange under the ticker symbol VREO and on U.S. over-the-counter markets as VREOF.