The marijuana industry is going through several major changes as companies make deals
Mergers and acquisitions (M&A) in the cannabis industry are already taking place in 2023. New York-based Ascend Wellness is now venturing into this activity. According to a recent announcement, the multi-state cannabis operator (MSO) has finalized a deal to acquire the assets of Devi Holdings in Maryland. The $19 million deal has been split into cash and stock.
Upon completion of the transaction, the press release explains that the 100% interest in Devi’s dispensaries and related property in Maryland will come under the Ascend name. 5.19 million shares of Class A common stock valued at $7 million and $12 million in cash has been the deal in which both companies agreed to shake hands.
With approximately $3 million in real estate, this new deal will serve to drive Ascend’s earnings even higher. Devi has brought in great returns, posting an annual run rate of $17 million in sales, said Dan Neville, Ascend’s CFO and interim co-CEO, in a statement.
Through this new acquisition, Ascend will expand its operations to a total of seven states in the Midwest and East Coast. In addition, looking ahead, the MSO has strategically positioned itself to benefit when the Old Line State officially launches recreational marijuana sales.
Maryland was one of two states that approved this market through the midterm elections. Now, Ascend will be able to have a competitive footprint by the time the proposal becomes a reality.
After the move was announced last Friday, Ascend shares were up 11.5% in afternoon trading at $1.31 and a market cap of about $247 million. The company continues to show great potential to be among the leaders in the cannabis industry.