BOCA RATON, Fla., Aug. 11, 2020 (GLOBE NEWSWIRE) -- Jushi Holdings Inc. (CSE: JUSH) (OTCQB: JUSHF), a globally-focused, multi-state cannabis and hemp operator, announced the closing of the previously announced agreement to acquire 100% of the equity of Pennsylvania Medical Solutions, LLC, a Pennsylvania grower-processor previously owned by a subsidiary of Vireo Health International, Inc. (CSE: VREO) (OTCQX: VREOF).
Through the completion of the Acquisition, Jushi adds PAMS and its 90,000 sq. ft. cannabis cultivation and processing facility (the “Facility”), strategically located within minutes of Interstate 81, Interstate 84 and the Pennsylvania Turnpike, enabling efficient wholesale distribution to the 89 dispensaries currently operating across the Commonwealth, including the Company’s eight operational BEYOND/HELLOTM dispensaries. The Facility is currently being upgraded to increase the total amount of high-quality, indoor cultivation area to approximately 45,000 sq. ft. with the property having the capacity to further upsize the indoor cultivation by an additional 25,000 sq. ft., bringing the total to 70,000 sq. ft.
Acquisition Highlights
- The Facility produces high-quality, indoor grown flower, and extracts;
- Expansion project currently underway is expected to be completed in Q3 2020;
- Indoor cultivation being expanded from 20,000 sq. ft. to 45,000 sq. ft. of cultivation1;
- Supplementing current CO2 extraction with new Class I, Division 1 ethanol extraction technology;
- Post-expansion, the facility is expected to produce between 800 to 1,000 lbs. of dried flower per month;
- The Facility is expected to supply the Company’s subsidiaries, and other licensed retail facilities.
"We are thrilled to close this acquisition ahead of our original schedule. The acquisition will allow us to provide high-quality, indoor-grown dried flower and concentrates products to the Commonwealth’s patients, who continue to experience constrained supply and high prices," said Jim Cacioppo, Chairman and Chief Executive Officer of Jushi. “With our successful recent financing, we are well capitalized to optimize the Facility’s production and continue to build-out our Pennsylvania retail footprint. Jushi, through its subsidiaries, has the collective rights to operate up to 15 dispensaries.”
Mr. Cacioppo concluded, “I’d like to officially welcome our new grower-processor members to the team and look forward to introducing a comprehensive suite of Jushi’s brands, including our award-winning brands, ‘The Lab: Concentrates’ and ‘The Bank: Flower + Genetics,’ as well as our precision formulated line of medical cannabis products ‘Nira Plus’.”
Upon closing, Jushi paid Vireo US$16.3 million in cash, a US$3.8 million seller note2, and assumed a US$17 million facility associated with a long-term lease obligation. No equity was issued in connection with this acquisition. Jushi funded the cash portion of the Agreement with the proceeds from the debt financing, which Jushi announced on June 22 and July 31, 2020. Further to our July 31st announcement, approximately US$30.3 million in cash proceeds have been received and have been released from escrow. Navy Capital Green Management, LLC led the debt financing round with an US$11.5 million investment.
As part of the Agreement, upon closing Jushi received an assignable purchase option (“Option”) to acquire 100% of the equity of Pennsylvania Dispensary Solutions, LLC (“PADS”), a Pennsylvania medical marijuana dispensary permittee in the Commonwealth’s Northeast region. PADS currently operates two medical marijuana dispensaries in Scranton and Bethlehem, with the right to operate one additional dispensary in the region. The Option expires 18 months from closing, and is subject to certain closing conditions, including approvals from all applicable regulatory authorities.
The Company will provide more details regarding the Acquisition and its expected impact on the Company’s financials during its second quarter earnings call expected later this month.
1 Preliminary expansion capacity, subject to final measurements
2 8% unsecured seller note, four-year maturity, with all principal and interest due at maturity
About Jushi Holdings Inc.
We are a globally focused cannabis and hemp company led by an industry-leading management team. In the United States, Jushi is focused on building a multi-state portfolio of branded cannabis and hemp-derived assets through opportunistic acquisitions, distressed workouts and competitive applications. Jushi strives to maximize shareholder value while delivering high-quality products across all levels of the cannabis and hemp ecosystem. For more information please visit www.jushico.com or our social media channels, Instagram, Facebook, Twitter and LinkedIn.
