New York-based multi-state operator Columbia Care Inc. expects to become the biggest cannabis operator in Colorado after the upcoming close of its deal to acquire vertically integrated Colorado player The Green Solution. A statement from last November valued the deal at about $140M.
The deal is set to close Sept. 1, Columbia said in a press release. The Green Solution has 23 dispensaries, mostly in the Denver area, and supplies its stores and a wholesale distribution network from its six cultivation facilities and a highly-automated manufacturing facility. Operating since 2010, it’s one of the longest serving chains nationwide.
“Closing the acquisition of The Green Solution represents a major milestone for Columbia Care,” Columbia Care CEO Nicholas Vita said in the statement, “Overnight, we have established a leading position in the world’s second largest cannabis market.”
With the deal, Columbia now has 95 facilities open or under development, including 73 dispensaries and 22 cultivation and manufacturing locations in 18 jurisdictions in the U.S. and the European Union. The press release notes The Green Solution’s recently enhanced cultivation and manufacturing infrastructure and that it has ambitious expansion and automation plans.
“We’re very excited about it,” said The Green Solution CEO Steve Lopez. The Green Solution will keep its name and Lopez said he expects “continued great selection, great prices” and convenience for customers.
The companies did not reveal details of the transaction. In Wednesday’s press release, Columbia Care and The Green Solution reported respective revenue of about $78.8M and $75.7M in 2019.
Kyle Speidell, who co-founded The Green Solution with his brother, Eric Speidell, called the deal “a landmark acquisition” that brings Columbia Care’s “expansive product portfolio to our customers in Colorado” and “enables us to quickly expand our brands, products and expertise to every major market in the U.S.”
The Denver Post reported late last year on the Speidells’ two years of lobbying to persuade Colorado to loosen capital and ownership restrictions on cannabis businesses.“We believe this will be an increased opportunity for all cannabis business in the state of Colorado,” Eric Speidell said when the deal was announced last November, days after the new rules took effect. “And we strategically worked on it to allow a transition like this to take place.”
Columbia Care’s expansion throughout the country has not always gone smoothly.
In May, MED company Florida MCBD LLC sued Columbia Care, alleging the multi-state operator interfered in its joint venture with a separate Florida-based nursery to obtain a coveted Florida MED license. The plaintiff also alleges the defendants used the trade secrets MCBD contributed to the license application to develop a plan for operating a MED business there. That case continues in New York Supreme Court.
Columbia Care has sought to dismiss the case. In court filings, it argues that the joint venture was already terminated, that the Florida nursery’s sole efforts garnered the license and that none of the plaintiff’s intellectual property has been used in operating the license.
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