Verano Expands Operations with Key Acquisitions
These acquisitions broaden Verano’s presence to 14 states, with 15 cultivation and production facilities and 150 dispensaries across the nation.
Chicago — Verano Holdings Corp. (Cboe CA: VRNO) (OTCQX: VRNOF) (“Verano” or the “Company”), a prominent multi-state cannabis company, has announced the completion of acquisitions as per previously disclosed agreements. The Company has acquired all ownership interests in three subsidiaries of The Cannabist Company Holdings Inc. (Cboe CA: CBST) (OTCQX: CBSTF) (“The Cannabist Company”), which is recognized as one of the most experienced cultivators, manufacturers, and retailers of cannabis products in the United States. The two subsidiaries, 203 Organix, L.L.C. and Salubrious Wellness Center, Inc. (collectively referred to as the “Arizona Operations”), are based in Arizona, while the third subsidiary, Columbia Care Eastern Virginia LLC, operates in Virginia (the “Virginia Operations”).
Strategic Growth in Virginia and Arizona
In Virginia, Verano will become the exclusive vertical cannabis operator in HSA 5, which serves nearly two million residents and attracts 14 million tourists annually. The Company will gain an active cultivation and production facility along with six operational dispensaries located in Hampton, Norfolk, Portsmouth, Suffolk, Virginia Beach, and Williamsburg. In Arizona, Verano will expand its retail presence to eight locations by adding stores in Tempe and Prescott, complementing its existing six Zen Leaf dispensaries and multiple cultivation and processing facilities.
Management Insights on Acquisitions
“Entering Virginia opens up significant growth opportunities within the current medical program and adds another valuable market to our portfolio, especially with the potential for adult use in the near future,” stated George Archos, Verano's founder, Chairman, and Chief Executive Officer. “By leveraging our extensive experience in mergers and acquisitions, we are actively integrating these facilities into our network. We aim to enhance our legacy as a leading medical operator while preparing for the potential adult-use market in Virginia. Additionally, expanding our operations in Arizona enables us to scale our retail presence and increase access to our award-winning brand portfolio, supported by enhanced cultivation capacity and high-performing dispensaries in prime locations.”
The Cannabist Company’s Perspective
David Hart, CEO of The Cannabist Company, expressed, “Verano has been an excellent partner throughout this thoughtful transaction, and we are optimistic about the future for our teams in Eastern Virginia and Arizona. This was a crucial step for us as we continue to build a stronger business and reshape our footprint to improve our financial stability, ultimately bringing us closer to profitability.”
Ongoing Operations in Virginia
The Cannabist Company will continue its operations in the Richmond area (HSA 4), which boasts approximately 80,000 square feet of cultivation and manufacturing capacity, five operational retail locations, and one more under development. Following the completion of the Arizona transactions, The Cannabist Company will operate in 14 markets, which will reduce to 12 once the divestments in Florida and Washington, DC are finalized.
Financial Insights on the Transaction
The total consideration for the Arizona Operations amounted to $15 million, paid in cash upon signing, with further adjustments pending. For the Virginia Operations, the total consideration, subject to adjustments, reached $90 million, which includes $20 million in cash, $40 million in Class A subordinate voting shares, and a $30 million promissory note.
About Verano Holdings Corp.
Verano Holdings Corp. (Cboe CA: VRNO) (OTCQX: VRNOF) is recognized as one of the leading companies in the U.S. cannabis industry, known for its strong revenue, extensive geographical reach, and impressive brand performance. Verano operates as a vertically integrated, multi-state operator dedicated to delivering an exceptional cannabis shopping experience in both medical and adult-use markets under the Zen Leaf and MÜV dispensary brands. The Company produces a diverse range of high-quality, regulated cannabis products across a wide array of trusted consumer brands.
Contact Information
For investor inquiries, please reach out to: Julianna Paterra, CFA, Vice President, Investor Relations
Verano
investors@verano.com
For media inquiries, please contact: Steve Mazeika, Vice President, Communications
Verano
Steve.Mazeika@verano.com
Frequently Asked Questions
What is the significance of the acquisitions for Verano?
The acquisitions enhance Verano's operational capacity and market presence in Virginia and Arizona, expanding its reach to 14 states and increasing its retail locations.
How many dispensaries does Verano now operate?
Verano currently operates around 150 dispensaries throughout the U.S., including the recent additions in Arizona.
What are the future plans for the Virginia market?
Verano intends to utilize its acquisitions in Virginia to drive growth in the existing medical cannabis program and to prepare for potential adult-use legalization.
Who were the key management figures in this transaction?
George Archos, the CEO of Verano, and David Hart, the CEO of The Cannabist Company, played pivotal roles in the discussions surrounding this transaction.
What kind of cannabis products does Verano produce?
Verano offers a wide variety of high-quality cannabis products, including flower, edibles, oils, and various branded items for both medical and adult use.
