Ayr Wellness Inc. (CSE: AYR.A, OTCQX: AYRWF) is getting into Illinois by way of its $30 million acquisition of Herbal Remedies Dispensaries, LLC.
The vertically integrated cannabis company signed a definitive agreement to acquire 100% of the membership interest of Herbal, which operates two licensed dispensaries in Quincy, Illinois, the county seat of Adams County.
The total consideration for the purchase is set to $30 million, consisting of $12 million in seller notes, $10 million in stock and $12 million in cash. The acquisition should be finalized during the fourth quarter.
Why It Matters
Upon the transaction, the New York-based multi-state operator will run its business across eight states.
What’s more, according to current estimates, Ayr is paying around five times Herbal Remedies’ 2021 EBITDA.
Herbal Remedies is one of the first cannabis dispensaries licensed in the Prairie State when medical cannabis was legalized eight years ago. Now, both recreational and medical marijuana are legal in Illinois.
Through this acquisition, Ayr will take over 50 employees from Herbal.
“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,” Jonathan Sandelman, chairman and CEO of Ayr Wellness said. “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.”
Sandelman praised Herbal Remedies’ previous business activities in Quincy, saying the company has everything they look for in a partner when reaching a new market.
“We look forward to working with the Herbal team as we continue to build our presence in the Illinois market,” Sandelman concluded.
The move comes on the heels of the company’s announcement it will buy cannabis cultivator Tahoe Hydroponics