Jushi Holdings Inc. recently acquired cultivation and production assets in Pennsylvania, said New Cannabis Ventures. The cannabis and hemp operator has closed a deal with Pennsylvania Medical Solutions (PAMS) LLC, which made Jushi the owner of 100% of the grower-processor’s stocks. Pennsylvania Medical Solutions was formerly owned by a Vireo Health International subsidiary.
The company paid the former owner $16.3M in cash with a $3.8M seller note and assumed a $17M facility with a long-term lease obligation. The report said that around $30.3M in cash proceeds was received and released from escrow, which funded the cash portion of the deal led by Navy Capital Green Management. The wealth management firm also placed an investment of $11.5M.
The agreement finalized Jushi’s purchase of PAMS, including its 9,000-square-feet marijuana cultivation and processing facility. The facility is seen as a strategically located site being placed near Interstate 81, Interstate 84, and the Pennsylvania Turnpike. This location gives the facility access to major thoroughfares, allowing the efficient transport of its products to and from the site.
In addition to the existing land area owned by the recently acquired facility, Jushi is also upgrading it to create an indoor cultivation area. A 45,000 square feet indoor area will be added, with the ability to increase the space further to 25,000 square feet. Upon the completion of this expansion, PAMS will be producing 800 to 1,000 pounds of dried flower per month, according to estimates.
This will supply Jushi’s retail facilities and other subsidiaries. The company owns 8 Beyond/Hello dispensaries. With the acquisition, Jushi will not supply products not only to its dispensaries but also to 89 others in Pennsylvania.
In the New Cannabis Ventures report, Jushi is also planning to improve the current CO2 extraction system with Class 1, Division 1 ethanol extraction technology.
Regarding the deal, Jushi chairman and CEO Jim Cacioppo said, “We are thrilled to close this acquisition ahead of our original schedule. This acquisition will allow us to provide high-quality, indoor-grown dried flower and concentrates products to the Commonwealth’s patients, who continue to experience constrained supply and high prices.”
Cacioppo was glad to welcome PAMS to its suite of brands including the award-winning The Land: Concentrates and The Bank: Flower + Genetics, as well as Nira Plus, a medical cannabis products line.
Pennsylvania is seen as “one of the most attractive medical cannabis markets in the country,” as per the New Cannabis Ventures report. A Marijuana Business Daily report showed that the state’s sales are steadily growing with a significant jump from an estimated range of $225 to $227M in 2019 to $400 to $500M this year.
Over the next few years, projections show that the state’s sales will continue to grow with an estimated range of $575 to 700M in 2021, $700 to $875M in 2022, $825M to $1 billion in 2023 and $900M to $1.1 billion in 2024.
More details about the acquisition are expected over the next few weeks.