CHICAGO--(BUSINESS WIRE)--Cresco Labs (CSE:CL) (OTCQX:CRLBF) (“Cresco Labs” or “the Company”), a vertically integrated multistate operator and the number one U.S. wholesaler of branded cannabis products, announced today the execution of a definitive agreement to acquire 100% of the outstanding equity interests in Blair Wellness, LLC (“Blair Wellness”), a Baltimore, Maryland medical cannabis dispensary (the “Transaction”). The Transaction is expected to close in Q4 of 2021.
“We’re pleased to announce the signing of another immediately accretive acquisition in a key U.S. cannabis market. This acquisition of Blair Wellness will represent a step toward building a meaningful, material position for Cresco Labs in Maryland – a state with tremendous growth potential over the coming years,” said Charles Bachtell, CEO and co-founder of Cresco Labs. “Our retail team consistently demonstrates the efficiency and effectiveness of the Sunnyside operating model, with our stores generating more revenue than respective state averages – Blair Wellness is no different, with revenue consistently higher than double the Maryland state average. As we expand operations across our footprint, we will continue to add high volume dispensaries that drive depth in strategic markets and complement our wholesale operations. We look forward to the incredible Blair Wellness team joining the Cresco Family!”
Operational Highlights
- One of the top performing dispensaries in Maryland
- 6,500 sq. ft. building located minutes from downtown Baltimore and centrally located between the city’s numerous universities
- Strong patient/customer retention from more than three years operating in market
Maryland Market Highlights
- 18th most populous state in the U.S. with approx. 6 million people
- Robust medical market growth with annualized retail sales over $500M
- Constructive commentary from Maryland House and Senate on an adult-use bill in 2022
Transaction Details
The Transaction implies a 1.8x 2021 revenue multiple, satisfied through the payment of cash and a twenty-four (24) month promissory note. The Transaction will be completed on a cash-free, debt-free basis with a mutually agreed upon normalized target level of working capital. The cash consideration would be payable upon closing of the Transaction.
The closing of the Transaction is subject to, among other things, the approval and receipt of all required CSE and regulatory approvals.
About Cresco Labs Inc.
Cresco Labs is one of the largest vertically integrated multistate cannabis operators in the United States, with a mission to normalize and professionalize the cannabis industry. Employing a consumer-packaged goods (“CPG”) approach, Cresco Labs is the largest wholesaler of branded cannabis products in the U.S. Its brands are designed to meet the needs of all consumer segments and comprised of some of the most recognized and trusted national brands including Cresco, High Supply, Mindy's Edibles, Good News, Remedi, Wonder Wellness Co. and FloraCal Farms. Sunnyside, Cresco Labs’ national dispensary brand, is a wellness-focused retailer created to build trust, education and convenience for both existing and new cannabis consumers. Recognizing that the cannabis industry is poised to become one of the leading job creators in the country, Cresco Labs operates the industry’s largest Social Equity and Educational Development initiative, SEED, which was established to ensure that all members of society have the skills, knowledge and opportunity to work and own businesses in the cannabis industry. Learn more about Cresco Labs at www.crescolabs.com.
Forward Looking Statements
This press release contains “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only the Company’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of the Company’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as, ‘may,’ ‘will,’ ‘should,’ ‘could,’ ‘would,’ ‘expects,’ ‘plans,’ ‘anticipates,’ ‘believes,’ ‘estimates,’ ‘projects,’ ‘predicts,’ ‘potential’ or ‘continue’ or the negative of those forms or other comparable terms. The Company’s forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including but not limited to those risks discussed under “Risk Factors” in the Company’s Annual Information Form for the year ended December 31, 2020 filed on March 26, 2021, and other documents filed by the Company with Canadian securities regulatory authorities; and other factors, many of which are beyond the control of the Company. Readers are cautioned that the foregoing list of factors is not exhaustive. Because of these uncertainties, you should not place undue reliance on the Company’s forward-looking statements. No assurances are given as to the future trading price or trading volumes of Cresco Labs’ shares, nor as to the Company’s financial performance in future financial periods. The Company does not intend to update any of these factors or to publicly announce the result of any revisions to any of the Company’s forward-looking statements contained herein, whether as a result of new information, any future event or otherwise. Except as otherwise indicated, this press release speaks as of the date hereof. The distribution of this press release does not imply that there has been no change in the affairs of the Company after the date hereof or create any duty or commitment to update or supplement any information provided in this press release or otherwise.