Curaleaf Holdings, Inc. has entered into a definitive agreement to acquire Bloom Dispensaries, a vertically integrated cannabis operator in Arizona, in an all cash transaction valued at approximately $211 million.
The transaction is expected to close in January 2022, subject to customary approvals and conditions.
The proposed transaction with Bloom includes four retail dispensaries located in the cities of Phoenix, Tucson, Peoria, and the only dispensary currently in Sedona, with a combined population of over 2.3 million and drawing millions of tourists every year.
In addition, Bloom strengthens Curaleaf's production capabilities in Arizona with the addition of two adjacent cultivation and processing facilities located in north Phoenix, totaling approximately 63,500 sq. ft. of space. Finally, Bloom has an attractive financial profile, generating expected 2021 revenue of approximately $66 million and EBITDA margins of more than 40%.
Following the close of Bloom and the previously announced acquisitions of Tryke Companies and Natural Remedy Patient Center, Curaleaf's retail footprint will increase to 16 dispensaries in Arizona and 128 nationwide.
"We are pleased to continue Curaleaf's expansion in the state of Arizona with the acquisition of Bloom,” said Boris Jordan, executive chairman of Curaleaf. “In addition to bolstering our strong position in this key growth market with an attractive portfolio of retail and cultivation assets, Bloom will be immediately accretive to our adjusted EBITDA margins upon close. On behalf of the Board of Directors and management team, I look forward to welcoming Bloom to the Curaleaf family."
Under the terms of the agreement, Curaleaf will pay $51 million in cash at closing, with the remaining approximately $160 million paid in three promissory notes of $50 million, $50 million, and $60 million due, respectively, on the first, second and third anniversary of closing of the transaction. The notes will be recourse only to shares and assets of Bloom and will not be guaranteed by any Curaleaf entity.