In what’s being billed as the biggest U.S. cannabis merger to date, Trulieve said it would acquire Harvest in a $2.1B all-stock deal. The conventional wisdom sees it as a way for the Florida-based MSO to become a major player in Arizona and have a beachhead in California.

  • The merger would create a company with 126 dispensaries across 11 states.
  • Trulieve says the merged company would be the most profitable MSO with $461M in estimated 2021 earnings on $1.2B in revenue.
  • Dai Truong has the financial nitty gritty. Here’s the investor deck.
  • Trulieve is the dominant operator in Florida’s MED-only market.
  • The deal could usher in a wave of mergers which had declined since the pot stock crash of 2019 and 2020.

Sander Zagzebski, an M&A attorney at Clark Hill, told WeedWeek:

  • The deal feels less frenzied and more strategic than the “land grab” mergers announced before the crash, some of which collapsed.
  • The involvement of investment bank Moelis & Co. as an advisor to Harvest “indicates that this was probably a heavily negotiated and well-thought out deal.”
  • Zagzebski called it “very good news for the industry” and expects to see more like it in the coming quarters.

Separately, a message posted on Reddit, which claimed to be from “Trulieve workers” claimed “pay was late – again” and after “lots of people” walked off the company offered workers $50. 

  • Trulieve declined to comment.

Quick Hit

  1. In earnings news: MSO MedMen saw revenue drop. Curaleaf did not.
  2. Cannabis is expected to add $92B to the U.S. economy in 2021.