The Cannabist Company Holdings Inc. (OTCQX:CBSTF) (FSE: 3LP) announced on Friday that it has entered into a definitive agreement to sell its 40,000-square-foot cultivation facility in Lakeland, Florida, for $11.4 million, payable in cash. The company said $2 million of this consideration is already held in escrow.
Additionally, the New York-based cannabis giant has reached a definitive agreement with MINT Cannabis and Shango, as joint venture partners, to sell all 14 of its Cannabist dispensaries in Florida, along with its cultivation and manufacturing facilities in Alachua and Arcadia. The Cannabist Company will retain one MMTC license, which it plans to divest to a third party at a later time.
Consideration for the MINT/Shango deal, subject to adjustment, is $5 million. Upon closing, the MINT Shango JV will pay a closing consideration of $3 million in cash and issue a $2 million promissory note. $750k of this consideration is already held in escrow.
Why It Matters
"We are pleased to announce our definitive agreements to transition our Florida operations over to a leading multistate operator and the MINT Shango JV," David Hart, CEO of The Cannabist Company, said. "This strategic move aligns with our ongoing efforts to build a better business – rationalizing our footprint and focusing on our growth markets to enhance profitability."
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What's Next
Both transactions under the definitive agreements are subject to closing conditions, including regulatory approvals. Post-closing, MINT Cannabis and Shango are expected to be rebranded to "MINT Cannabis."
After exiting the Florida market, The Cannabist Company's operational footprint will shrink to 13 markets, and further to 12 upon finalizing its exit from Washington, DC.
- Florida's Medical Cannabis Market Sees Explosive Growth Ahead Of November Legalization Ballot
CBSTF Price Action
The Cannabist Company Holdings' shares traded 6.48% higher at $0.2776 per share at the time of writing on Friday afternoon.
