With its acquisition of Los Sueños Farms, Curaleaf Holdings, Inc. (CSE: CURA) (OTCQX: CURLF) has made its dreams of acquiring Colorado’s largest outdoor grower come true.
On Monday, the multistate operator said it completed the acquisition of Los Sueños and its related entities in a cash and stock deal estimated at US$67 million.
The transaction, announced in May, gives Curaleaf vertical integration in Colorado and significantly strengthens its market presence in the country’s second largest cannabis economy, executive chairman Boris Jordan said in a statement.
“This deal provides Curaleaf with a high-quality, efficient, and low-cost supply of biomass to support our wholesale and retail customers in Colorado and, once interstate commerce is allowed, on a regional scale,” he said. “Overall, our newly expanded cultivation capacity will allow us to better serve Colorado’s US$2.2 billion annual cannabis market opportunity.”
As it completes the deal, Curaleaf says it gains three Pueblo, Colorado outdoor cannabis grow facilities covering 66 acres of cultivation capacity including land, equipment and licensed operating entities; an 1,800-plant indoor grow; and two cannabis stores serving adult-use customers.
The additional biomass will be used to fuel the company’s Select brand in Colorado, which it says already leads the market there and is distributed to nearly 2,000 stores across 18 states.
The company expects the deal will add 50,000 pounds (22,680 kilograms) in annual low-cost production. Curaleaf says it intends to double production with the targeted goal of US$100 a pound (US$0.22 per gram) at the open-air cultivation site.
Los Sueños founder Bob DeGabrielle will continue to oversee the operation, as well as take responsibility for Curaleaf’s Colorado wholesale and retail business.
“By leveraging the outdoor grow expertise of the talented Los Sueños team, we will optimize our new outdoor scale and cultivation technologies to lower our total cost of delivery, with the genetics that we perfect there serving as a center of excellence for all our future U.S. outdoor cultivation capabilities,” Curaleaf CEO Joseph Bayern said.
The firm is one of the largest weed companies in America, operating in 23 states with 109 dispensaries, 22 cultivation sites and over 30 processing sites employing over 5,000 people.
Curaleaf stock fell around 5 per cent Monday to $14.45 on the Canadian Securities Exchange.