Transaction Firmly in Line with GTI’s Strategic Expansion Plans to Distribute Brands at Scale
- One of only four cultivation and processing facilities in Connecticut with a 41,000 square foot facility in West Haven
- Includes ownership of first dispensary slated for Westport, Connecticut
- Positioned for expansion to meet state’s growing demand
- Acquisition has attractive multiples and is accretive to shareholders
CHICAGO and VANCOUVER, British Columbia, Jan. 07, 2019 (GLOBE NEWSWIRE) -- Green Thumb Industries Inc. (GTI) (CSE:GTII) (GTBIF), a national cannabis consumer packaged goods company and owner-operator of the high growth national retail chain RISE™, announced today that it has signed a definitive agreement to acquire Advanced Grow Labs LLC (AGL) and enter the Connecticut market. AGL is one of only four companies in Connecticut licensed to grow and process cannabis. The Connecticut-based cannabis company operates a 41,000 square foot manufacturing facility in West Haven with the potential to expand. In addition, AGL has a 46 percent ownership of a recently-awarded dispensary that will be located in Westport which makes it the only vertically licensed company in the state. AGL produces and distributes a wide range of cannabis products to every operating store in the state.
“We are thrilled that AGL is joining the GTI team and look forward to continuing to serve Connecticut communities with high-quality cannabis products,” said GTI Founder and Chief Executive Officer Ben Kovler. “AGL is a highly successful company in a limited license state with a fantastic management team that will continue to run the business. We are full steam ahead executing on GTI’s expansion plans as we look to create shareholder value. This transaction is an example of that given the attractive multiples. In the past two months alone, we announced the acquisition of Nevada-based Integral Associates; were awarded additional retail licenses for 12 stores in Pennsylvania; and entered the New Jersey market with a cultivation, processing and retail license win. We are now solidly positioned in the tri-state area with our entry into Connecticut via AGL. The momentum is strong.”
Upon the close of AGL and the other recently announced acquisition, GTI will have 12 manufacturing facilities and licenses for 85 retail locations across 11 states.
“We could not have picked a better partner than Green Thumb Industries, an industry leader that shares our values, commitment to producing high-quality brands and dedication to giving back to the communities we serve,” said AGL Founder and Chief Executive Officer David Lipton. “Our business is poised to expand to meet the growing needs of the state’s medical marijuana patients and this partnership with GTI will support that expansion.”
The Connecticut medical marijuana program currently has more than 30,000 patients and over 1,000 registered physicians. The program has 31 qualifying conditions and accepts petitions from the public to consider adding additional conditions for which medical marijuana can be useful. With a population of about 3.6 million, the state has four cultivation and processing sites and 18 dispensaries.
Transaction Details: The transaction is valued at approximately $80 million which includes $15 million to be paid in cash and 7.0 million Subordinate Voting Shares of GTI. The purchase agreement also includes additional consideration based on performance targets and up to an additional 1 million Subordinate Voting Shares of GTI subject to pricing conditions prior to closing. The arms-length transaction is expected to close in the first quarter of 2019, subject to customary regulatory approvals.
*All currency is in US dollars.
About Green Thumb Industries:
Green Thumb Industries (GTI), a national cannabis cultivator, processor and dispensary operator, is dedicated to providing dignified access to safe and effective cannabis nationwide while giving back to the communities in which they serve. As a vertically integrated company, GTI manufactures and sells a well-rounded suite of branded cannabis products including flower, concentrates, edibles, and topicals. The company also owns and operates a rapidly growing national chain of retail cannabis stores called RISE™. Headquartered in Chicago, Illinois, GTI has nine manufacturing facilities and licenses for 72 retail locations across nine highly regulated U.S. markets. Established in 2014, GTI employs approximately 500 people and serves thousands of patients and customers each year. GTI was named a Best Workplace 2018 by Crain’s Chicago Business. More information is available at GTIgrows.com.
No securities regulatory authority has in any way passed upon the merits of the proposed transactions described in this news release or has approved or disapproved of the contents of this news release.
Cautionary Note Regarding Forward-Looking Information
This press release contains statements which constitute “forward-looking information” within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of GTI with respect to future business activities. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only GTI’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of GTI’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or may contain statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “will continue”, “will occur” or “will be achieved”. The forward-looking information and forward-looking statements contained herein may include, but are not limited to, information concerning the proposed acquisition, expectations regarding whether the proposed acquisition will be consummated, including whether conditions to the consummation of the proposed acquisition or other acquisitions referenced will be satisfied and whether the proposed acquisitions will be completed on the current terms, the timing for completing the proposed acquisitions, expectations for the effects of the proposed acquisition or the ability of the Company to successfully achieve business objectives, expectations regarding the Connecticut cannabis market and expectations for other economic, business, and/or competitive factors.
By identifying such information and statements in this manner, GTI is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of GTI to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, GTI has made certain assumptions. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: the ability to consummate the proposed acquisition; the ability to obtain requisite regulatory approvals and third party consents and the satisfaction of other conditions to the consummation of the proposed acquisitions on the proposed terms and schedule; the potential impact of the announcement or consummation of the proposed acquisition on relationships, including with regulatory bodies, employees, suppliers, customers and competitors; changes in general economic, business and political conditions, including changes in the financial markets; changes in applicable laws; compliance with extensive government regulation; and the diversion of management time on the proposed acquisition. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.
Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are the following: changes in general economic, business and political conditions, including changes in the financial markets; changes in applicable laws; and compliance with extensive government regulation; together with the risk factors outlined by the company in its annual information form dated July 10, 2018 along with the risk factors outlined in the most recently filed MD&A of the company filed on SEDAR from time to time. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.
Although GTI believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release. GTI does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.
|Investor Contact:||Media Contact:|
|Jennifer Dooley||Linda Marsicano|
|Chief Strategy Officer||VP, Corporate Communications|
Source: Green Thumb Industries