Ever-acquisitive hydroponics retailer GrowGeneration (GRWG 0.91%) has announced yet another asset buy. On Tuesday, the company said it is the new owner of The Harvest Company, a small privately held peer based in Northern California. GrowGeneration did not reveal the price nor the key terms of the deal.
It did say that all of The Harvest Company's 16 employees will join GrowGeneration. Harvest's founder, Robert Masterson, will remain with the business as an advisor.
Image source: Getty Images.
The Harvest Company is situated in the so-called Emerald Triangle, a largely rural region of the state that has long been popular with marijuana growers. With the drug being legal in California, these days the Triangle is the largest cannabis cultivation area in the U.S.
"As the country's largest legal cannabis market, California continues to be a critical market for GrowGeneration," CEO Darren Lampert was quoted as saying.
"The Emerald Triangle in particular represents tremendous market potential, with over 500 cultivation licenses in Trinity County alone," he added, referring to one of the three counties that comprise the region. Lampert also said that the nearby city of Redding is a burgeoning market for cannabis.
With this latest deal, GrowGeneration is continuing to hold to its strategy of growth through acquisitions both large (relative to its rather limited industry) and small. Although we don't know the price, it's likely that The Harvest Company purchase wasn't prohibitive, and GrowGeneration has plenty in its coffers. At the end of its most recently reported quarter, the company's cash holdings totaled over $92 million.
Owning The Harvest Company now gives GrowGeneration 55 stores throughout the U.S.
On Tuesday, GrowGeneration's stock price grew by nearly 5.8% on the news, in contrast to the 0.2% dip in the S&P 500.
