A deal that will let Toronto-based cannabis company iAnthus Capital Holdings Inc. acquire Purchase-based Valley Agriceuticals LLC for $17 million received approval last week from the state Department of Health.
Along with approving the acquisition, the state also granted Valley Agriceuticals a license to operate within New York’s medical marijuana program, iAnthus said in a statement.
While Valley Agriceuticals was not awarded one of the first five medical marijuana licenses from the state in 2015, the Health Department announced plans this year to phase in five more companies, including Valley Agriceuticals.
The acquisition, announced in June, expands iAnthus’ portfolio into five regulated cannabis states in the U.S., which the company said is the largest footprint among public companies focused on licensed cannabis operations.
With the approval, iAnthus is a step closer to completing the acquisition of Gloucester Street Capital LLC and its wholly owned subsidiaries, Valley Agriceuticals LLC and Valley Agriceuticals Real Estate LLC. The deal includes $2.3 million in cash and $15 million in iAnthus shares, priced at $2 per share.
The acquisition still requires approval from the Canadian Securities Exchange, where iAnthus is traded. The company said in its announcement that it expects to finalize the deal this quarter.
Valley Agriceuticals’ license allows it to open dispensaries in Brooklyn, and Dutchess, Oneida and Suffolk counties. The company is also approved to launch its 6,500-square-foot plant cultivation and processing facility in Wallkill.
“The team is already making progress in securing prime real estate in each of the dynamic markets in which it has been granted licenses,” said Hadley Ford, CEO of iAnthus. “The Brooklyn and Suffolk County dispensaries in particular provide Valley Agriceuticals with direct exposure to large patient bases.”