Columbia Care Strengthens Presence In Colorado: Closes $42M Acquisition Of Medicine Man

Columbia Care Inc. CCHW CCHW CCHWF (FSE:3LP) announced Monday it has wrapped up the previously announced acquisition of the Colorado-based vertically integrated cannabis company Medicine Man.

Deal Details

Total upfront consideration was $42 million, including $8.4 million in cash and $33.6 million in stock with the potential for an additional milestone payment based on 2021 performance.

The sum represents a multiple of roughly 4.5x projected 2021 EBITDA. In addition, it is immediately accretive to adjusted EBITDA and cash flow from operations.

What It Means For Columbia Care

This acquisition adds a 35 000 square foot indoor cultivation facility and four Denver-metro dispensaries to Columbia Care’s Colorado operations, including the Medicine Man Longmont location, which is anticipated to close in the first three months of 2022.

The New York-based company’s footprint in Colorado will now total 26 dispensaries and six cultivation and manufacturing facilities, including those under The Green Solution brand.

“The acquisition of Medicine Man enhances our position as the leader in the state by combining with a recognized operator that has been a consistent outperformer in the Colorado market since its founding,” Nicholas Vita, CEO of Columbia Care explained.

The deal is also the “next step in the evolution of Medicine Man, from an ambitious family-run company to part of a best-in-class operation,” Sally Vander Veer, CEO of Medicine Man, said.

What’s Next?

Vander Veer emphasized that Medicine Man’s focus now turns toward carrying out Columbia Care’s vision and “bringing as much value as possible” to the company’s operation.

Vita added, “Our vision and values are aligned, and we look forward to expanding our Columbia Care family with the addition of those who made Medicine Man such a successful company.”

Foley Hoag LLP is serving as legal counsel to Columbia Care. Right Side Advisory Services is acting as financial advisor to Medicine Man. Husch Blackwell LLP is acting as legal counsel to Medicine Man.

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• EXCLUSIVE: What Makes Columbia Care Such A Successful Cannabis Company?
• Mike Tyson Is Getting Back Into The Cannabis Ring, Launches Tyson 2.0 With Columbia Care
• Columbia Care Teams Up With Rapper Pitbull On The Launch Of New CBD Product Line
• Columbia Care Kicks Off Sales At Boston Cannabist Dispensary, Announces Social Equity Partnerships In Virginia

CCHWF Price Action

Columbia Care’s shares traded 2.29% higher at $3.0688 per share after the market close on Monday.

Photo: Courtesy of Scott Graham on Unsplash