Grown Rogue International Inc. (CSE:GRIN) (OTC:GRUSF) has obtained licensing approval with the New Jersey Cannabis Regulatory Commission and closed its first option to acquire 44% of ABCO Garden State, LLC on Friday, May 31.
What Happened
Obie Strickler, the company's CEO, said "All regulatory approvals from the CRC have been received and we exercised and closed our option to acquire 44% of ABCO."
Under the deal, Grown Rogue has an option to acquire 70% of ABCO through two options, including Option 1 and Option 2, for 44% and 26%, respectively.
Why It Matters
ABCO holds an annual cultivation license with the New Jersey Cannabis Regulatory Commission with local zoning and planning approvals and sufficient power supply. Upon receiving licensing approval, the company bought Option 1 for roughly $1,260,000, which has been paid in cash.
See also: Grown Rogue Reports Record Q1 Revenue, CEO Calls These Two States 'Primary Growth Drivers'
What's Next
Grown Rogue expects to exercise Option 2, a move pending regulatory approval, two years after operations commence. The purchase price for Option 2 is approximately $720,000.
In addition, the company has the right to buy the remaining equity of ABCO at fair market value.
Strickler recently reiterated the company's "primary growth drivers in 2024 and 2025 continue to be our expansion efforts in New Jersey and Illinois."
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That said, "construction [of New Jersey Phase I] is nearing completion," Strickler said on Wednesday adding "we will soon be providing our high-quality, craft cannabis to New Jerseyans."
Meanwhile, Grown Rogue announced its debut in Illinois earlier this year via a partnership with EBC Ventures, establishing Rogue EBC LLC, a joint venture poised to reshape the craft cannabis segment statewide.