Cannabis producer Curaleaf is making an entry into the international markets as part of its cannabis business expansion through a $286 million deal to buy European cannabis company Emmac Life Sciences, according to Bloomberg, Wednesday.
Emmac is Europe's biggest cannabis company operating in several medical cannabis markets, including Britain, Germany, Spain, Italy, and Portugal.
Curaleaf announced the deal after the close of trading Tuesday and said the procurement would be a split cash-and-stock arrangement, with 15% of payment being made in cash and 85% funded through Curaleaf subordinate voting shares.
The cannabis sector witnessed robust sales figures as pandemic-triggered concerns resulted in higher marijuana revenues. Curaleaf, in particular, impressed investors with its increase in revenue.
In its third quarter of fiscal 2020, revenue climbed threefold, up an impressive 195% year-on-year to $182 million. With a market valuation of around $11 billion, Curaleaf is already the biggest U.S.-based multistate cannabis company.
"We believe 2021 will be the transformational year for the company with revenue projections above $1.2 billion and full integration of all its acquisitions provides the true leverage of its footprint," FX Empire quoted Scott Fortune, equity analyst at Roth Capital Partners, as saying.
Curaleaf Executive Chairman Boris Jordan said in a statement that the deal would give the Massachusetts-based company access to a market that has huge potential to expand beyond the U.S.
"By doing this transaction, Curaleaf is indisputably the biggest operator on a revenue and a footprint basis around the globe," Executive Chairman Boris Jordan said in remarks quoted by Bloomberg.
The deal comes as competition grows in both the U.S. and the international markets. The biggest cannabis companies are jockeying for position to expand through acquisitions ahead of what many producers expect will be further legalization in the U.S. and increasing acceptance around the world.
