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Cresco Labs Inc
Symbol CL
Shares Issued 216,851,695
Close 2021-04-14 C$ 15.25
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Cresco Labs closes Bluma Wellness acquisition

2021-04-14 16:10 ET - News Release

Also News Release (C-BWEL) Bluma Wellness Inc

Mr. Charlie Bachtell of Cresco Labs reports

CRESCO LABS CLOSES ACQUISITION OF BLUMA WELLNESS, EXPANDS INTO FLORIDA

Cresco Labs Inc. has closed its previously announced acquisition of Bluma Wellness Inc.

Transaction highlights:

  • Cresco Labs now has meaningful operations in 10 states.
  • The company's footprint includes all seven of the top-10 most populated states in the country with cannabis programs.
  • Florida, with more than 525,000 (1) medical cannabis patients and a state population greater than 21 million people, represents one of the largest absolute growth opportunities among cannabis markets.
  • Bluma Wellness's competitive advantages in Florida include one of the state's only cultivation facilities, producing ultrapremium quality flower, as well as a differentiated retail model, including strategic, high-volume storefronts and an omnichannel sales platform.
  • Operations include eight dispensaries strategically located around the state, offering same-day delivery and curbside pickup. Seven more dispensaries are currently in permitting and/or are under construction.
  • Fifty-four thousand feet of cultivation in Indiantown are currently under expansion and will continue to deliver premium craft flower at greater scale to support additional store openings and expanded product offerings.

"The closing today represents yet another strategic acquisition in a top-five market that is true to our strategy -- building the most strategic geographic footprint and achieving material market share positions within each state. Cresco Labs and Bluma Wellness have proven track records of operational execution and, together, have key advantages for growth and a clear pathway to scale. We look forward to amplifying operations and executing our playbook in Florida this year and in the years to come," said Charlie Bachtell, chief executive officer and co-founder of Cresco Labs.

"We couldn't be more excited to begin working with Cresco Labs to execute our shared vision for aggressive expansion in Florida," said Brady Cobb, chief executive officer of Bluma Wellness. "Cresco's deep operational efficiency and relentless focus on quality, combined with Bluma's best-in-state cultivation operations and innovative approach to retail, creates the perfect operating environment for our continued success in Florida."

Transaction details

The acquisition was completed by way of a plan of arrangement under the provisions of the Business Corporations Act (British Columbia). Pursuant to the terms of the arrangement, holders of common shares of Bluma Wellness received 0.0859 subordinate voting share of Cresco Labs for each Bluma share held. In total, Cresco Labs acquired 184,814,281 Bluma shares, representing all of the issued and outstanding Bluma shares, in exchange for 15,875,449 Cresco shares.

It is anticipated that the Bluma shares will be delisted from the Canadian Securities Exchange (CSE) as of the close of trading on April 14, 2021, and Bluma intends to submit an application to the applicable securities regulators to cease to be a reporting issuer and to terminate its public reporting obligations.

Pursuant to the letter of transmittal mailed to shareholders of Bluma Wellness as part of the materials in connection with the special meeting of Bluma Wellness shareholders held on March 19, 2021, to receive the portion of the Cresco shares to which they are entitled, registered holders of Bluma shares are required to deposit their share certificate(s) or DRS (direct registration system) statements representing their Bluma shares, together with a duly completed letter of transmittal, with Odyssey Trust Company, the depositary under the arrangement. Shareholders whose Bluma shares are registered in the name of a broker, dealer, bank, trust company or other nominee must contact their nominee to deposit their Bluma shares.

About Cresco Labs Inc.

Cresco Labs is one of the largest vertically integrated multistate cannabis operators in the United States, with a mission to normalize and professionalize the cannabis industry. Employing a consumer packaged goods (CPG) approach, Cresco Labs is the largest wholesaler of branded cannabis products in the United States. Its brands are designed to meet the needs of all consumer segments and are composed of some of the most recognized and trusted national brands, including Cresco, High Supply, Mindy's Edibles, Good News, Remedi, Wonder Wellness Co. and FloraCal Farms. Sunnyside, Cresco Labs' national dispensary brand, is a wellness-focused retailer created to build trust, education and convenience for both existing and new cannabis consumers. Recognizing that the cannabis industry is poised to become one of the leading job creators in the country, Cresco Labs operates the industry's largest social equity and educational development initiative, SEED, which was established to ensure that all members of society have the skills, knowledge and opportunity to work and own businesses in the cannabis industry.

(1) Florida Office of Medical Marijuana.

We seek Safe Harbor.

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