Benzinga | Jun 11, 2021 11:59AM EDT

Columbia Care Strengthens Position In Mid-Atlantic Via $240M Acquisition Of Green Leaf Medical

Columbia Care Inc. (NEO: CCHW) (OTCQX: CCHWF) revealed Friday it has finalized its purchase of privately-held cannabis company Green Leaf Medical, LLC, for $240 million in stock and cash.

The total consideration of $240 million includes $45 million in cash and $195 million in Columbia Care shares, with the option of extra performance-based achievements in 2022 and 2023. This transaction is immediately accretive to the company's gross margin, adjusted EBITDA and free cash flow with an acquisition multiple of around 4.8x 2021 adjusted EBITDA.

Via this deal, Columbia Care achieves the maximum number of dispensary licenses in both Maryland and Ohio, and gains around 400,000 square feet of cultivation and production capacity.

More About The Acquired Green Leaf

Green Leaf is a vertically integrated multi-state operator whose first-quarter revenue amounted to around $29 million, gross margin to above 50% and adjusted EBITDA margin to above 30%. It is considered one of the biggest growers and wholesalers in Pennsylvania, with its products being sold in 85% of the state's 100 dispensaries.

In the state of Maryland, Green leaf runs a 42,000 ft2 cultivation facility and two operating dispensaries. Its products are sold in almost half of the state's 95 dispensaries.

Green Leaf is also among the largest cultivators in Virginia, running an 82,000 ft2 cultivation, production and dispensary facility in Richmond. It also offers home delivery services across the state.

"I am pleased to announce the completion of Columbia Care's acquisition of Green Leaf today, well ahead of our originally anticipated close, which secures our position as a national leader and the most scaled operator in the Mid-Atlantic," said Nicholas Vita, CEO of Columbia Care.

Price Action

Columbia Care's shares were trading 1.69% lower at $5.54 per share at the time of writing.

Image Credit: Matca Films