Ayr Wellness Inc. (OTCQX: AYRWF) is staying busy this week with acquisitions as the company adds an Illinois operation called Herbal Remedies Dispensaries, LLC for approximately $30 million. Herbal is an operator of two licensed retail dispensaries in Illinois. The deal is expected to close in the fourth quarter of 2021. The transaction includes $10 million in stock, $12 million in seller notes, and $8 million in cash. Based on current projections, Ayr said it believes it is paying approximately 5x Herbal Remedies’ 2021 EBITDA. Herbal will add roughly 50 employees to Ayr’s total headcount.
“Today’s announcement represents the next step in our goal to position Ayr as a leading MSO, with a strong presence in states that deliver meaningful revenue. Illinois will become the eighth state in our expanding footprint, which now reaches close to 85 million people. The total cannabis market in Illinois is already run-rating at $1.8 billion in annual sales, despite adult-use launching only 18 months ago. The team at Herbal Remedies has done a tremendous job in Quincy, building a fantastic business and a strong reputation for excellent customer service and merchandising – exactly what we at Ayr Wellness look for in a partner when entering a new market. We look forward to working with the Herbal team as we continue to build our presence in the Illinois market,” said Jonathan Sandelman, Chairman and Chief Executive Officer of Ayr Wellness.
Herbal Remedies was among the first cannabis dispensaries licensed in the State of Illinois when the State approved the Compassionate Use of Medical Cannabis Program in 2013. Both medical and recreational use is now permitted.
Viridian Capital Advisors analyst Jonathan deCourcey said in a report, “We believe the retail assets will be just the beginning of Illinois expansion and expect the company will seek out cultivation