Cannabis is booming, and consolidation is coming. Yesterday, Arizona-based , a publicly traded company with dispensaries in many legalized states, acquired , a Chicago-based operator and grower of Cannabis, for $850 million.
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The deal marks a milestone for cannabis that鈥檚 gone capitalist. It is one of the largest known consolidations of marijuana companies in the United States, giving Harvest Health 鈥渢he right to operate up to 200 facilities across 16 states and territories,鈥� according to .
The deal is also notable for the potential impact it could have on private startups. Venture capitalists are notoriously motivated to disrupt the status quo, often flouting regulations in pursuit of growth. Yet cannabis startup investment has remained mostly muted due to its status as an illegal federal substance. However, as the narrative and laws around cannabis usage and distribution changes, the potential for returns is likely to become more attractive.
Verano, according to Crunchbase, raised a last October, likely returning a significant sum to its known investors and in its sell to Harvest Health.
The deal marks at least the third large cannabis-related deal since the start of 2019. Last month, we reported on marijuana producer and distributor closing on n what was touted as for a U.S.-based cannabis company. In January, San Jose, Calif.-based announced it had raised $75 million in an 鈥渙versubscribed鈥� financing that included participation from , former CEO of Yahoo and Autodesk, and three-time Super Bowl MVP and Pro-Football Hall of Famer .
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