Another slowly developing acquisition in the cannabis industry has been finalized. Cresco Labs (CRLBF -6.62%) announced Friday it has closed its buyout of grower and retailer Hope Heal Health, after being granted approval for the deal by the Massachusetts Cannabis Control Commission.
Although small, the once privately held Hope Heal Health has licenses to grow cannabis and manufacture cannabis products; it also holds a dispensary license for a single retail location, with rights to get two more.
Happily for Cresco and its shareholders, the Commission's approval comes as the Hope Heal Health dispensary has begun selling recreational-use cannabis in addition to medical marijuana products. The dispensary is located in the eastern Massachusetts town of Fall River, which is on its border with Rhode Island and close to that state's capital and major city of Providence.
As with numerous other buyouts by acquisition-hungry, publicly traded marijuana companies, the Cresco/Hope Heal Health arrangement took time to cross the finish line. The pair originally agreed to the deal at the end of 2018. Then and now, the financial details were not specified.
In a press release announcing the closing, Cresco wrote that with its absorption of Hope Heal Health, it is "stepping into a fully operational, vertically integrated business that is immediately accretive with both positive EBITDA and cash flow." However, again, Cresco declined to provide specifics.
In spite of the obvious progress the finalization of this deal represents, Cresco's stock was down by more than 5% in late afternoon trading Friday.