TerrAscend Eyes More M&As After Gage Acquisition Closes
TerrAscend Corp. plans to continue to build its presence in the United States as a multi-state cannabis operator through new acquisitions and organic growth, a company executive told MarketWatch.
Beyond the Thursday close of its major acquisition of Gage Growth to enter the Michigan market, TerrAscend TRSSF,
Executive Chairman Jason Wild said the company plans to operate 40 dispensaries by the end of the year, up from 25 currently in five states.
“From an M&A perspective, we’re looking to deepen the states we’re in, and we want to add one to two more states over the next six to 12 months,” Wild said. “We’re looking east from Michigan to the east coast and down the east coast from Massachusetts to Georgia.”
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TerrAscend also plans to increase its workforce from its current employee base of 1,250, which includes 750 people from TerrAscend and 500 from Gage.
The company currently operates a cultivation facility in Boonton, NJ, and is opening a dispensary in Lodi as Garden State prepares to allow the sale of cannabis for adult use.
“We have a lot to do,” Wild said. “New Jersey is going to be huge.”
The company has purchased a warehouse in Maryland and is considering a larger presence in Pennsylvania, which is now moving towards the medical use of cannabis by adults.
Last September, TerrAscend agreed to purchase Gage for up to 77.1 million shares, including 51.3 million initial shares and 25.8 million additional shares in exchange for the target company’s convertible securities. .
At last check, the 77.1 million shares are valued at approximately $369 million at $4.79 per share as of Friday’s trade date. That’s down from the $550 million value of the all-stock deal in September when TerrAscend was trading at nearly $7 per share just before airing its plan to buy Gage.
Upon closing of its merger with TerrAscend, Gage had $72.3 million in pro forma cash, including $55 million from senior secured debt financing. TerrAscend also has $103 million in cash as of September 30. Wild said the company’s balance sheet remains in a good position to close more deals.
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