This State Exemplifies Ascend Wellness' Success Despite Cannabis Capital Shortage, CFO Says

"Capital has really dried up across the debt sale-leaseback equity market side of things," said Ascend Wellness Holdings, Inc. AAWH CFO Dan Neville, during his recent appearance at the Benzinga Cannabis Capital Conference in Miami.

With capital availability tightening, he stressed the severity of the situation for both public and private multi-state operators (MSOs) in an already capital-intensive industry.

"This is a capital-intensive industry. So that's generally not a good combination. I think as tough as it is out there for the public MSOs if you take a click down to the private MSOs or single state operators that are out there, I think it's just as difficult if not more difficult on the capital raising side of things," Neville said. 

The capital shortage will continue to fuel a trend toward consolidation in the cannabis industry, Neville predicts, adding, "Scale does matter in this industry and bigger is better."

This observation reflects the ongoing industry-wide pressure to achieve economies of scale in order to survive and thrive in an environment marked by capital scarcity.

"Capital is tight in a capital-intensive industry; that's not a good combo. Tough for public MSOs, even more for private ones. We'll see more consolidation. Scale matters; bigger is better" - @AscendHoldings' Dan Neville at @Benzinga Conference
Join us in Chicago, Sept 27-28 -… pic.twitter.com/oZN2okGBhR

— Javier Hasse (@JavierHasse) July 25, 2023

Despite the prevalent headwinds, Ascend Holdings seems to have its own game plan.

"For us specifically, I think we're going to continue to focus on smaller bolt-on M&A," he said. "You know it's what we've done historically. We've had success there focused on smaller acquisitions in near-term adult-use markets."

Maryland, Neville explained, is a perfect example of how successful his company has been with smaller acquisitions.

"And we'll look to do more of the same here in the years to come," he added.

For those interested in the cannabis industry's capital market trends and strategies, the Benzinga Cannabis Capital Conference provides a valuable platform for such discussions. The event is set to return to Chicago on September 27 and 28. All relevant information is available on bzcannabis.com

"We'll focus on smaller bolt-on M&A. It's our historical success path. Smaller acquisitions in near-term adult-use markets, like Maryland, will be our strategy in the years to come." @AscendHoldings' Dan Neville on $AAWH's strategy at @Benzinga Conference.
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— Javier Hasse (@JavierHasse) July 26, 2023