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by Stockwatch Business Reporter
The S&P/TSX Cannabis Index slipped 0.69 point to 152.47 Monday, while the Canadian Securities Exchange Composite Index inched up 0.12 point to 379.63. In company news, Joseph Lusardi and Boris Jordan's United States-based Curaleaf Holdings Inc. (CURA) rose three cents to $8.00 on 485,700 shares after announcing an amended agreement for its purchase of GR Companies Inc., which does business as "Grassroots."
Under the amended terms, Curaleaf will issue 118.9 million shares to Grassroots, which will dilute existing Curaleaf shareholders by 27 per cent. It will be an all-share deal; the $75-million cash component of the deal has been eliminated. The cash was eliminated to provide "maximum flexibility" to support the future growth of the company. Using today's closing price, the amended deal values Grassroots at $950-million.
Grassroots comes with a hefty price tag, as one of the bigger private cannabis companies in the United States. It has over 30 operational dispensaries and has licences to operate over 50. Most notably, Curaleaf chief executive officer Joseph Lusardi says it provides Curaleaf with "an important entry to ... markets in the Midwest." Curaleaf specifically mentions Illinois and Pennsylvania as states where it will "accelerate" the company's expansion. (Recreational cannabis became legal in Illinois at the start of the year, while only medical cannabis is legal in Pennsylvania.)
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