MariMed, a multi-state cannabis operator, has entered into a definitive agreement to acquire Kind Therapeutics U.S.A., a vertically-integrated cannabis business in Maryland, for $20 million. The transaction will result in the third state, incremental to Massachusetts and Illinois, in which MariMed will have acquired a licensed cannabis business it manages and assisted in developing.
Kind, which holds cannabis licenses for cultivation and production as well as a provisional license for a dispensary, currently leases from MariMed subsidiary Mari Holdings MD a 180,000-square-foot cultivation and processing facility, in Hagerstown that MariMed developed; Mari Holdings also owns and is developing a dispensary for Kind in Annapolis, which is slated to open in early 2022.
The acquisition will further represent MariMed’s implementation of its strategic growth plan to consolidate the multiple state cannabis businesses it organically developed and manages.
Under MariMed’s management, Kind has been successfully manufacturing and distributing cannabis and cannabis products into Maryland’s robust wholesale cannabis industry, which has grown to 103 dispensaries.
“I am pleased to announce our agreement to acquire Kind, which operates in one of the top medical cannabis programs and markets in the country,” said Bob Fireman, CEO of MariMed. “This acquisition will deliver another transformational year for MariMed in 2022, building on two consecutive years of more than 100 percent cannabis revenue and Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) growth.”
In addition, MariMed will acquire the minority interests of one of the current owners of Kind in two subsidiaries of the company that own cannabis facilities in Maryland and Delaware for $2 million.
Maryland’s legal medical cannabis program currently has more than 139,000 registered patients and, according to the Maryland Medical Cannabis Commission, the state receives more than 200 applications for medical cannabis cards every day. Maryland’s medical cannabis program was on pace to generate more than $500 million in sales in 2021.
According to Cowen Research, with a population of 6.2 million, Maryland’s medical cannabis program boasts some of the highest rates of registered medical consumers, incidence usage and spending, on a per capita basis, among all legal medical cannabis programs in the U.S. The state legislature is reviewing proposals to implement an adult use cannabis program in the future.