A $2.1 billion cannabis giant after Trulieve buys Harvest

This is a purchase that will shake up the cannabusiness. The Trulieve of Florida, a medical cannabis specialist, is opening its wallet to acquire one of its main competitors, Arizona-based Harvest Health and Recreation. In exchange, Harvest shareholders will receive a quarter of Trulieve’s shares. This merger creates a cannabis giant valued at $2.1 billion by industry analysts. With an estimated margin of 37 %, the future merger will go head-to-head with Curaleaf, the global leader in the industry.

In fact, Harvest and Trulieve are two companies with a strong presence in the United States, whose shares are traded on the Toronto Stock Exchange. The new group will draw on 126 dispensaries across 11 U.S. states that have legalized cannabis, in addition to 22 cannabis production facilities. And above all, it’s a win-win partnership.

«Harvest allows us to establish an immediate and significant presence in established markets. It also enables us to accelerate our entry into Arizona.», said the CEO of Trulieve in a statement. Especially since the state of the Grand Canyon has just legalized cannabis. A market of 7 million people, making it the 16th most populous U.S. territory.

Trulieve has (too much) of a presence in Florida, but not enough elsewhere

Trulieve, for its part, has a strong presence in Florida. Perhaps even too strong, especially for a state where medical cannabis is legal, but not recreational. The Tallahassee-based company operates 82 of the 87 dispensaries in the state, located in Miami and Orlando. Harvest, for its part, operates 15 stores in Arizona, 9 in Pennsylvania, 8 in Florida, and 4 in California.

Especially since in the United States, as long as the Cannabis is not legal at the federal level, each state has different laws. And businesses cannot sell cannabis across state lines. «Even though we can't transport cannabis, we can share our talent and our skills.», ", says CEO Kim Rivers, trying to take comfort in that.

For Harvest, this acquisition confirms the company's entrepreneurial success. Steve White founded it just ten years ago, in 2011. «The ambitions we had when we started the company are in a completely different league from the ones we have today!», he tells Forbes. In the future alliance, Kim Rivers, the former CEO of Trulieve, will become the CEO of the new group. Steve White's role, meanwhile, has yet to be determined.