Trulieve Buys Harvest Health & Recreation for $2.1 Billion

Trulieve, one of the largest medicinal cannabis operators, is now the nation’s most prominent cannabis retailer after inking a $2.1 billion agreement to obtain former contender Harvest Health & Recreation.

The deal marks a notable development in Florida, where Harvest Health & Rec held one of a whopping 22 licenses to cultivate, maintain, and sell medicinal cannabis to an increasing patient community and in the nation’s quickly expanding cannabis industry. Trulieve CEO Kim Rivers called finalizing the deal a “transformational milestone” in her account out of Gadsden County, Florida.

Trulieve was one of Florida’s first medicinal cannabis operators, launching after the Sunshine State lawmakers in 2014 passed a bill to protect non-euphoric cannabis for patients with epilepsy. The business boomed after Florida taxpayers in 2016 established a constitutional amendment that broadly legalized medical cannabis.

Harvest Health & Recreation, which got its humble beginnings in Florida as San Felasco Nurseries, was also an initial entrant in the Sunshine State’s cannabis industry, obtaining a license from the Florida Department of Health (or DOH) in 2016 as the state geared up for the predictable passage of the constitutional revision.

With Harvest Health & Rec finalized, Trulieve will have nearly 150 retail locations throughout 11 states, including Florida. Trulieve will also host more than 3 million square feet of space exclusively for cannabis cultivation and help from nearly 9,000 employees. Before the transaction was finalized, Trulieve had approximately 85 retail sites in the state.

Due to the state’s statute, medicinal cannabis operators cannot hold more than one license. Harvest Health & Recreation sold its license to pave the way for its acquisition by Trulieve. Planet 13, which functions in Nevada and California, paid a hefty $55 million in cash for the license previously held by Harvest.

Harvest Health and Recreation 14 retail locations in Florida will temporarily close this month as the business begins converting to the Trulieve brand. During this time, Harvest employees will experience Trulieve training. Trulieve is establishing a regional core strategy across the states., with hubs in the Sunshine State, Pennsylvania, and Arizona. This will better position Trulieve as more states approve medicinal cannabis, and others approve adult use of cannabis.

According to Trulieve, the regional focus should counteract patient anxieties about the monopolization of the cannabis business. Trulieve expects to continue its retention rate of 75% of patients across the nation after acquiring Harvest Health & Recreation.

According to a report issued last week, Trulieve recorded revenues of $215 million in the second quarter of 2021. Additionally, Trulieve recorded nearly $41 million, while Harvest noted earnings a bit past the $100 million milestone. The cannabis industry has zoomed throughout the country over the past decade. However, as more states move ahead with legalizing recreational cannabis for grown-ups, similar efforts in Florida have been thrashed.
The Florida Supreme Court rejected the suggested constitutional reforms to permit people to use recreational cannabis twice this year.

Earlier this year, justices said the slate summary of a recommendation put forward by the committee Make It Legal Florida would deceive voters into thinking that the recreational use of cannabis in Florida will be independent of any repercussions, civil or criminal.’ The result of it being misleading derived from cannabis continuing to be illegal under federal regulation.

Advocates of recreational use of cannabis have been lobbying Congress to legalize cannabis, which would make it more hospitable for states to approve recreational use. However, the lobbying has been futile as cannabis remains federally illegal. There is still hope as the MORE Act, an act that would reschedule cannabis and make it federally legal, is not dead just yet.

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