Green Thumb Industries, one of the most valuable U.S. pot companies, is betting big on Las Vegas.
The Chicago-based company, which has more than a dozen weed dispensaries in eight states, said it is acquiring Nevada marijuana stores and cultivation facilities in a deal valued at about $290 million. The acquisition of Integral Associates, about 80 percent of which is being paid in stock, gives Green Thumb a dispensary on the Las Vegas strip, a high-profile location visited by millions of tourists each year.
Nevada’s population of around 3 million is relatively small. But with millions of tourists flocking to Las Vegas each year for gambling and entertainment, the market has become increasingly important for U.S. cannabis companies that are battling to get national recognition. Sales in the state, which allows recreational use, are expected to be as high as $615 million this year, according to Marijuana Business Daily, a trade publication.
“Having a brand presence in Las Vegas is unbelievably valuable,” said Ben Kovler, Green Thumb’s founder and chief executive officer.
Kovler’s ancestors were early investors in a family-run distillery led by James Beauregard Beam and his great-grandfather Harry Blum helped turn Jim Beam into one of the most recognizable bourbon brands.
Kovler took Green Thumb public earlier this year through a reverse takeover in Canada, and the company sports a market valuation of about $1.79 billion, making it one of the most valuable U.S. companies in the industry.
Green Thumb currently holds licenses for 60 dispensaries, including in Illinois, Massachusetts and Maryland. Kovler, like others in the industry, was buoyed by the recent midterm elections, which saw voters in three states ease marijuana restrictions. And with the House of Representatives in the hands of Democrats, the industry is hopeful that the U.S. is closer to easing marijuana prohibition at the federal level, which has kept banks and institutional investors largely on the sidelines.
“The dominoes continue to be set in the right direction,” Kovler said.
To contact the reporter on this story: Craig Giammona in New York at cgiammona@bloomberg.net
To contact the editors responsible for this story: Anne Riley Moffat at ariley17@bloomberg.net, Jonathan Roeder, David Scanlan
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