In early November, cannabis company Curaleaf, which is currently in 23 states, announced it had sold $31.5 million in proceeds in an attempt to expand its Maryland cannabis operations. Namely, Curaleaf sold its interest in Frederick, MD-based HMS Health, a cultivator and processor for $27.5 million, to TerrAscend Corp. which currently has vertically integrated operations in California, New Jersey, and Pennsylvania.
That $27.5 million is broken down like this: The $25 million purchase along with 5% yearly interest (adding up to $2.5 million) that must be paid to Curaleaf by April of 2022.
“This acquisition enables TerrAscend to expand its footprint into another robust limited license medical cannabis market with strong, long-term growth potential,” TerrAscend Executive Chair and CEO Jason Ackerman said a press statement. “By combining HMS with our industry-leading scaled operations in the adjacent states of Pennsylvania and New Jersey, we will leverage our strong management team and corporate support functions to drive economies of scale.”
Currently, HMS operates out of a 22,000 square foot facility in Frederick that cultivates and processes medicinal cannabis flower and oil. Additionally, the facility can produced edibles once the regulations for edibles in Maryland are approved.
And for $4 million, Curaleaf sold Curaleaf Maryland Inc., which has a processing license in Cumberland, MD. Who that license was sold to has not yet been made public.
By selling HMS, Curaleaf can continue with its plans to purchase Maryland Compassionate Care and Wellness, operating out of a 55,000 square foot cultivating and processing facility in Taneytown, MD as well as a dispensary in Gaithersburg, MD.
“The asset sales we announce today will allow us to optimize Curaleaf’s vertically integrated presence in Maryland within the regulation which limits operators to a single grow and single processor,” Joseph Lusardi, Chief Executive Officer of Curaleaf said in a statement. “Overall, the Maryland market continues to see impressive growth with over 115,000 certified cannabis patients. The actions we are taking aim to further strengthen Curaleaf’s position as a leading cannabis operator in Maryland as well as reaffirm our commitment to best serving our customers across the state.”
These sales are subject to Maryland Medical Cannabis Commission approval.
At the Maryland Medical Cannabis Commission (MMCC) meeting in October, three growers and eight processors were announced. The growers are Herbiculture Cultivation, MAS Alliance, and Viola Maryland, and the processors are AHI Group, Bouquet Labs, Ceres Naturals, Element MD, Greener Good, Herbiculture Manufacturing, Marileaves Extractions, and Organic Remedies MD.
The next MMCC meeting is on December 17 at 2 p.m. There is a Policy Committee Meeting on December 1 and a Finance Committee Meeting on December 2.