Ayr Strategies Makes An Arizona Play On Heels Of Adult-Use Vote

Ayr Strategies AYRSF has recognized Arizona’s marijuana market potential.

The Toronto-based cannabis company purchased a vertically integrated operation in the Copper State that includes both growing and processing facilities as well as three licensed dispensaries.

The transaction deal includes a binding term sheet for three licensed dispensaries, one in Glendale, and two in Chandler, one licensed cultivation and processing facility in Chandler, and one licensed cultivation facility under development in Phoenix.

Under the deal, Ayr should provide an upfront consideration of $81 million, consisting of $10 million in cash, $41 million in stock and $30 million in seller notes.

In addition to Arizona, Ayr’s portfolio currently consists of assets in Nevada, Ohio, Massachusetts and Pennsylvania, reaching around 43 million people.

The move comes on the heels of Election Day, where Arizona voters decided to embrace adult-use marijuana.

Ayr wasn’t the only cannabis company that was punctual with an Arizona play. Harvest Health & Recreation Inc. HRVSF added three medical marijuana licenses in the state just ahead of voting.

After Ayr's transaction, the company will run or offer its services to 11 dispensaries, with eight dispensary licenses projecting to become operational next year, and more than 140,000 ft2 of operating cultivation and processing space with the potential to broaden to 600,000 square feet.

“Arizona has been a terrific medical market, third in the U.S. in terms of patient penetration at 3.4% and currently generating approximately $800 million in annual revenue," Jonathan Sandelman, Chairman and CEO of Ayr stated. "Yesterday, voters decided to make it a recreational use market as well. We are thrilled to be able to leverage our experience, talent, brands and success in Nevada and Massachusetts to bring quality and choice to the Arizona market.”

The transaction allows Ayr to enter "a thriving and robust market" and generate "significant value" for shareholders, Sandelman says. 

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