Harvest Health & Recreation (HRVSF) is divesting its relatively sizable portfolio of California dispensaries, and the buyer is a familiar name in the cannabis world.

Harvest and Hightimes Holding -- the parent company of storied marijuana magazine High Times -- announced in separate press releases that the latter will purchase "certain equity and assets with respect to 13 planned and operational California dispensaries," from Harvest. Hightimes Holding will pay up to $5 million in cash, $7.5 million in a one-year promissory note with a 10% interest rate, and $67.5 million in its series A preferred stock.

Marijuana buds atop a collection of US currency.

Image source: Getty Images.

In its press release, Harvest said that it will keep certain dispensaries, as well as licenses for potential retail locations in the state. It did not provide further details.

"This planned divestment of select retail assets in California allows Harvest to focus on optimizing operations and expanding assets in core markets such as Arizona, Florida, Maryland, and Pennsylvania while retaining a smaller retail presence in California," the cannabis company wrote. Harvest pledged to continue evaluating the worth of keeping its retail assets, and to consider further streamlining its operations.

Hightimes Holding, which is not publicly traded, will rebrand the acquired dispensaries as High Times. In its press release, the company said with clear enthusiasm that the transaction will "enable Hightimes Holdings to become one of the largest branded cannabis retailers in California overnight."

The deal is subject to certain closing conditions which were not specified, plus approval from the relevant regulatory bodies. Both parties expect the sale to close by June 30.

Investors seem happy that Harvest is slimming its retail profile. The company's stock closed more than 12% higher on Tuesday, in contrast to the slump of the wider equities market.