Columbia Care Completes Acquisition of Green Leaf Medical; Cements Market Leading Position in Mid-Atlantic
- Affirms Company’s Position as a Leading Cultivator, Processor, Wholesale Supplier and Retailer in Limited License States of Maryland, Ohio, Pennsylvania and Virginia
- Adds Approximately 400,000 Square Feet of Cultivation and Production Capacity as well as Four Operational Dispensaries and Six In-Development Dispensaries in Key Markets
- Immediately Accretive to Columbia Care Gross Margin, Adjusted EBITDA and Free Cash Flow with Acquisition Multiple of Approximately 4.8x 2021 Adjusted EBITDA
- Achieves Vertical Integration in all 18 of Columbia Care’s Markets, Enabling the Company to Launch Brands Across the Country, Expand Retail and Wholesale Market Share, Optimize Margin Profile and Drive Shareholder Value
NEW YORK-June 11, 2021-(BUSINESS WIRE)–Columbia Care Inc. (NEO: CCHW) (CSE: CCHW) (OTCQX: CCHWF) (FSE: 3LP) (“Columbia Care” or the “Company”), one of the largest and most experienced cultivators, manufacturers and providers of medical and adult-use cannabis products in the United States, today announced that it has completed its acquisition of Green Leaf Medical, LLC (“Green Leaf” or “gLeaf”), a privately held, fully-integrated cannabis multi-state operator (MSO) with a leading market presence throughout the mid-Atlantic region.
Total upfront consideration was approximately $240 million, comprised of $45 million in cash and $195 million in Columbia Care stock, with the potential for additional performance-based milestones in 2022 and 2023. This transaction is immediately accretive to gross margin, Adjusted EBITDA and cash flow from operations.
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.
Nicholas Vita, CEO of Columbia Care
Green Leaf’s proprietary gLeaf brand, cultivation and production scale, and outstanding reputation and culture are exceptional complements to the Columbia Care operational footprint in these key markets.
He added, “Together, we will accelerate and expand our strategy of offering the best products and service to these rapidly expanding medical markets and will be well-positioned in states that are preparing for adult-use, such as Virginia. We are thrilled to welcome the Green Leaf team, led by Philip Goldberg and Kevin Goldberg, to the Columbia Care family and will strive to ensure the continued growth and customer focus that Green Leaf is known for through a thoughtful and deliberate integration.”
We set out to build a leading cultivation, extraction and retail network that optimizes the customer experience by leveraging technology and meaningful human interaction – and we’re proud that we have accomplished that.
Philip Goldberg, Green Leaf’s CEO and Co-Founder
After searching for the right home for our company, people and communities, it was clear that there was one organization that shared our vision and priorities – Columbia Care.
Kevin Goldberg, Co-Founder, General Counsel and President of Green Leaf added: “We are incredibly grateful to the Green Leaf employees who built the company right alongside us and are the heart of our organization. We look forward to the opportunity to expand the gLeaf brand into Columbia Care’s markets and realize the benefits of our combined innovation and growth that happens with the two teams joined together.”
For additional information regarding the transaction, please refer to Columbia Care’s press release issued on December 22, 2020, or visit the presentations section of the investors’ website at www.ir.col-care.com.
Green Leaf 1Q 2021 Financial Performance1
- Revenue of approximately $29 Million
- Gross Margin in excess of 50%
- Adj. EBITDA Margin in excess of 30%
- One of the largest and most scaled cultivators and processors in Pennsylvania, with a 274,000 ft2 cultivation and processing facility; over 100,000 ft2 of this capacity is currently operational, and fully funded construction on the additional 174,000 ft2 will be completed and operational by year-end 2021
- One of the state’s largest wholesalers; products are sold in approximately 85% of Pennsylvania’s 100 operating dispensaries
- Perfects vertical operations when combined with Columbia Care’s dispensaries in northeast Pennsylvania, offering significant revenue and margin expansion opportunities in both retail and wholesale channels
- Fully built out 42,000 ft2 cultivation facility, and a separate processing facility with opportunities to significantly increase production and efficiencies
- Green Leaf has two operating dispensaries in Maryland (Montgomery and Frederick County) with a third pre-approved dispensary (Prince George’s County) in development and expected to open in 2022, creating local scale with Columbia Care’s existing Montgomery County dispensary
- One of the state’s largest wholesalers, with products sold in nearly half of the state’s 95 operating dispensaries
- Operates a robust statewide home delivery service, with 14 delivery vehicles and personnel that can be leveraged in adjacent markets of Washington, D.C., Virginia and Delaware via existing Columbia Care footprint
- The transaction increases Columbia Care’s total Maryland dispensary license count to four, which is the maximum number allowed per operator in the state, making it one of the most scaled retailers and wholesalers in Maryland
- Green Leaf is the largest cultivator in the state, operating a fully built out 82,000 ft2 cultivation, production and dispensary facility in Richmond, with plans for significantly increased efficiencies underway
- Green Leaf commenced cultivation operations in May 2020 and retail operations in November 2020, serving as the retailer in 20 counties in central Virginia—including the state capital, Richmond
- Provides home delivery access throughout the state with 10 vehicles
- Adds to Columbia Care’s existing operations in southeastern Virginia (Norfolk/Hampton Roads), one of the most densely populated areas in the state, and complements Columbia Care’s operational cultivation and production facility, the second largest in the state with over 60,000ft2, as well as one operating dispensary in the Norfolk area
- Each licensee is entitled to operate one co-located cultivation/dispensary facility and five stand-alone dispensaries in their authorized region – allowing up to ten additional dispensaries between both licensees, all of which are currently in various stages of development
- Flower will be available in Virginia beginning September 2021
- Green Leaf operates one retail dispensary – enabling Columbia Care to achieve the state maximum of five dispensaries
- Columbia Care operates, and is expanding into, a 63,000 ft² cultivation, production and manufacturing facility, which also recently launched commercial sales, making it one of the most scaled, fully integrated operators in the state
- Columbia Care currently sells finished goods to more than 85% of licensed dispensaries in Ohio
All amounts reflected in this press release and references to $ are in U.S. dollars.
About Columbia Care
Columbia Care is one of the largest and most experienced cultivators, manufacturers and providers of cannabis products and related services, with licenses in 18 US jurisdictions and the EU. Columbia Care currently operates 122 facilities2 including 92 dispensaries and 30 cultivation and manufacturing facilities. Columbia Care is one of the original providers of medical cannabis in the U.S. and continues to deliver industry-leading products and services. The company launched Cannabist, its new retail brand, creating a national dispensary network that leverages proprietary technology platforms. Through its dispensary network, the company offers products spanning flower, edibles, oils, and tablets, and manufactures popular brands including Seed & Strain, Triple Seven, Classix, Plant Sugar, Press, Amber and Platinum Label CBD. With more than four million sales transactions since its inception in 2012, Columbia Care is known for setting the standard for compassion, professionalism, quality, care, and innovation in the rapidly expanding cannabis industry. For more information on Columbia Care, please visit www.col-care.com.
1 1Q 2021 financial results based on unaudited Green Leaf management numbers. Gross margin and Adj. EBITDA are non-IFRS measures.
2 Pro forma facilities either open or under development; includes facilities where Columbia Care provides consultative services pursuant to the terms of a management services arrangement