Toronto, Ontario, Canada-based iAnthus Capital Holdings has agreed to acquire Valley Agriceuticals LLC, which holds a conditional medical cannabis license in New York, for $17.3 million, in what is the venture capital firm’s largest transaction to date. The deal, once completed, will expand iAnthus’ portfolio into five states.
Randy Maslow, president of iAnthus, said the proposal, coupled with their holdings in Massachusetts, “sets the stage” for the company to be a “key player” in the northeastern United States.
“With a population of nearly 20 million residents, a rapidly growing patient base, and only 10 medical cannabis licenses, New York is an ideal market for iAnthus to enter,” Maslow said in a press release. “The state’s move to eliminate some of the Program’s initial limitations has created an incredibly potent opportunity for accelerating patient growth.”
The deal includes $2.3 million payable in cash and $15 million payable in common shares of iAnthus priced at $2 per share. The proposal includes Valley Ag’s cultivation campus which consists of about 136 acres of real estate currently zoned for cannabis cultivation and a 6,500-square-foot cultivation and processing facility.
Philip Green, CFO of Valley Ag, said New York could “potentially be one of the largest medical marijuana markets in the U.S.,” having removed some of the initial program roadblocks by expanding the qualifying condition list and allowing nurse practitioners and physician assistants to certify patients for the program. There are currently 21,009 patients registered under the program, which does not allow whole-plant or smokeable cannabis.
The deal is subject to final approval from the New York State Department of Health and the Canadian Securities Exchange. It is expected to close in the third quarter of this year.