Trulieve just acquired Harvest Health & Recreation, officially making them the largest cannabis company in the nation.

Trulieve finalized this purchase today for $2.2 billion. The company, based out of Tallahassee, and founded to be a medical cannabis entity, the largest legal cannabis company to date.

“Trulieve is primarily a vertically integrated, ‘seed-to-sale’ company in the U.S. and is the first and largest fully licensed medical cannabis company in the State of Florida,” according to a press release. “Trulieve cultivates and produces all of its products in-house and distributes those products to Trulieve-branded dispensaries throughout the State of Florida, as well as directly to patients via home delivery. Trulieve is also a licensed operator in California, Massachusetts, Connecticut, Pennsylvania and West Virginia.”

Separately, Trulieve and Harvest Health & Recreation reported a combined income of $317.6 million in the second quarter of the year, not a small chunk of change. Truileve also gained a major cash acquisition with their $350 in debt financing back in June, and Harvest received $55 million recently from a licensing sale in Florida. Trulieve brought in $289 million in cash and cash alternatives as of June, and Harvest brought in $71 million.

Trulieve brought in $215 million in revenue during the second quarter, with income of almost $41 million. Harvest reported more than $102 million in revenue, for the combined $318 million.

To date, this is the highest among public reporting cannabis companies in this country, putting Trulieve at the top.

“Today’s announcement is the largest and most exciting acquisition so far in our industry, creating the most profitable public multi-state operator.  Importantly, our companies share similar customer values with a focus on going deep in core markets. This combination offers us the opportunity to leverage our respective strong foundations and propel us forward with an unparalleled platform for future growth,” stated Kim Rivers, Chief Executive Officer of Trulieve.

This acquisition allows Trulieve to continue its expansion in growing markets across the nation. “Harvest provides us with an immediate and significant presence in new and established markets and accelerates our entry into the adult use space in Arizona. Trulieve and Harvest are leaders in our markets, recognized for our innovation, brands, and operational expertise with true depth and scale in our businesses. We look forward to providing best-in-class service to patients and customers on a broader national scale as we create an iconic U.S. cannabis brand.”

“We are thrilled to be joining Trulieve, a company that has achieved unrivaled success and scale in its home state of Florida,” said Steve White, Chief Executive Officer of Harvest.  “As one of the oldest multi-state operators, we believe our track record of identifying and developing attractive market opportunities combined with our recent successful launch of adult use sales in Arizona will add tremendous value to the combined organization as it continues to expand and grow in the coming years.”

In total, Trulieve now has a total inventory of 149 dispensaries and three regional hubs, and the company operates across 11 states. This also significantly puts Florida on the map as a leading market for cannabis, despite the state’s slow start in the recreational space. Arizona and Pennsylvania are other notable leading markets.

“This combination brings together two companies with depth and scale in key markets, providing a platform for growth for years to come,” said Harvest CEO Steve White. “Trulieve’s customer-centric values match well with Harvest’s dedication to improving lives through the goodness of cannabis.”

Now, due to this acquisition, Trulieve will have access to Harvest Brands. Under the Harvest umbrella are Alchemy and Roll One, both popular in the local market.

When the sale went down, those with Harvest shares received 0.117 in subordinate voting shares of the company. Trulieve gave out 50,874,175 new shares in exchange for all of Harvest’s shares. Harvest is based in Canada, and thus the sale was compliant with British Columbia’s Business Corporations Act.

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A recent report from New Frontier Data explores the rapid growth of both medical and recreational cannabis sales in its “Global Cannabis Report: Growth & Trends Through 2025” report. The report is a comprehensive look at what to expect in the global cannabis industry over the next few years, while analyzing the current and future trends in the global markets of North America, Europe, Latin America, the Caribbean, Oceania, Asia and Africa.

New Frontier Data Founder, Publisher and Executive Chair Giadha A. DeCarcer, shared in her Letter from the Publisher at the beginning of the report that this industry will only continue to grow and expand. 

“When we released our first Global Cannabis Industry Report in 2019, it was clear that cannabis legalization would prove to be one of the most consequential socioeconomic movements of our time,” she wrote. “In just two years’ time, the number of countries having legalized some form of cannabis has increased from 50 to 70, and there are now 10 countries legalizing adult use, almost a twofold increase from 2019. As legal markets across the globe continue to evolve, we have found that regulatory structures and societal norms vary greatly, and each country, region and market require a nuanced approach to quantifying, qualifying and understanding them.”

The report states that in 2020, regulated markets sold $23.7 billion in high-THC cannabis product (which is 10 times the sales numbers of any other regulated markets in the world), and the combined total of medical and recreational cannabis sales in the U.S. was $20.3 billion. In comparison, Canada saw approximately $2 billion in high-THC cannabis products sold in 2020. The constant rise of cannabis in both the U.S. and Canada could lead to sales increasing to $51 billion by 2025.

Outside of North America, though, sales of high-THC products were lower overall, but still on the rise. Germany is home to Europe’s largest medical cannabis program to date, and in 2020, the country collected $206 million. That includes a collective number of both medical cannabis patients who use their insurance for a reimbursement program, as well as those who sought out cannabis products in other ways. 

Like the U.S., cannabis is not federally legal in Spain, but the individual provinces in the country do have various regulations on cannabis sales. In 2019, cannabis clubs in the country reached $431 million, which makes Spain a contender for becoming one of the largest industries in the world, behind the U.S. and Canada.

On September 23, a webinar entitled “Exploring the Global Cannabis Economy: Trends, Projections & Opportunities” was held, featuring a handful of prominent speakers discussing the global cannabis industry’s future. 

New Frontier Data Chief Knowledge Officer John Kagia predicted that even though there is “$8 billion of capital is invested in the cannabis industry, that rate of investment is only expected to grow.” 

Another speaker, Tim O’Neill, VP of international markets for SōRSE Technology, pointed out that adhering to a specific market’s regulations on cannabis is becoming more difficult, saying that “either you can sell there, or you cannot.” He also mentioned that for investors seeking profit, there is opportunity in Chinese and Indian markets.

According to Mikhail Sagal, founder and president of TSRgrow, the success of non-US cannabis industries will rely on quick establishment of a regulatory framework. Those countries “will all have to change and become more standardized and acceptable,” he said, and added that companies “will have to change and be able to adapt in changing systems.”

New Frontier Data describes the expectation of Managing Director of FTI Consulting, Lincoln Eckhardt, as hoping for the best but expecting the worst. He shared the history of the vaping crisis in 2020 and how addressing the issue directly was the best course of action. 

“Would that have been the answer a year or 18 months ago?,” Eckhardt asked. “Look at separate medical markets—[while] Oklahoma has very few rules, when Alabama comes online, it will be incredibly restrictive,’ so stakeholders must ascertain its risk assessment and corporate investment in terms of what it decides to be worth offering.” 

A recording of the two-hour webinar can be found here, which contains a variety of new cannabis industry data and topics regarding the global industry.

On a global scale, New Frontier Data states that the main force behind legalization efforts is thanks to medical cannabis initiatives. However, each country is approaching the concept differently. Many countries in Europe have embraced the pharmaceutical route, which allows patients to pick up their cannabis medicine through a pharmacy. 

In Latin American countries with legal sales, success has been found in programs through private clinics and physicians who are available to prescribe cannabis. Medical cannabis patient numbers continue to rise around the world due to easier access to medicine. In 2020, an estimated 4.4 million people were registered as active medical cannabis patients throughout the world. Furthermore, an additional two million patients are expected to register for medical cannabis over the next five years, which could reach 6.5 million people by 2025.

Recreational cannabis sales are expected to double that of medical cannabis sales by 2025 as well. On the recreational front, only 10 countries have legalized recreational cannabis, with six approving the sale of high-THC products.

Many of these regions are only beginning to implement their programs. In the Netherlands and Spain, a model of “decriminalized club/social-use” model, whereas South Africa and Jamaica have approved limited access for religious groups. Uruguay on the other hand has fully legalized recreational cannabis, and as a result, has sold more than 1,700 kilograms of high-THC product.

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