GTI Expands with Acquisition of Nevada’s Top Cannabis Operator

Written By: Jen Neville
November 14, 2018

cannabis dispensary nevada

Green Thumb Industries recently announced that it had signed a definitive agreement to acquire 100% of Integral Associates which adds operational capacity, distribution, retail footprint, and Best-of-Class talent.

The acquisition includes:

– Integral Associates’ retail brand Essence, which currently operates three high-traffic locations across the Las Vegas Valley
– Desert Grown Farms, a 54,000 square foot state-of-the-art cultivation and processing facility with an award-winning genetics library of 100+ strains
– Cannabiotix NV, a 41,000 square foot cultivation and processing facility which has been a recognized High Times Cannabis Cup award winner several times over

“We are thrilled to expand GTI’s production, distribution and retail footprint in one of the most popular tourist destinations in the world,” commented Ben Kovler, GTI Founder and Chief Executive Officer. “Integral Associates are exceptional operators—they have a highly admired and respected business comprised of two world-class cultivation and processing facilities, multiple award-winning products, strong wholesale distribution, three impressive retail dispensary locations with significant retail market share and healthy EBITDA. This acquisition is immediately accretive and an important milestone as we position GTI to scale in one of the only limited license adult use markets.”

Kovler added, “We are excited to welcome Armen Yemenidjian to our senior leadership team, where he will serve as president. Armen’s wealth of experience in building and growing an outstanding company will be a tremendous asset to our organization. We are also pleased to announce that Alex Yemenidjian will be  GTI Board of Directors and serve on the audit committee. , and we look forward to leveraging his vast and varied experience and success.”

“This partnership is ideally positioned to bring our business to the next level,” stated Armen Yemenidjian. “I am extremely excited to join the GTI team and be a part of an industry leader that places a strong emphasis on brands, is a respected and award-winning employer, and is committed to community involvement. This is a big win for Nevada communities and the customers we will continue to serve."

Integral Associates was founded by Alex Yemenidjian, Armen Yemenidjian and Brian Greenspun in 2014 and quickly become one of Nevada’s dominant operators. Their production capability, including Desert Grown Farms and Cannabiotix NV, totals 95,000 square feet of state-of-the-art, pharmaceutical grade cultivation and processing capacity.

Nevada Market

GTI entered Nevada in 2016 and currently operates two adult use cannabis stores—Rise Spanish Springs and Rise Carson City—along with a Carson City-based cultivation and processing facility.

Nevada dispensaries sold nearly $425 million worth of recreational marijuana in the state’s first full year of sales — about 60 percent higher than the state’s projections of $265 million — which significantly outpaced all other states that have legalized the sale of recreational marijuana. According to the state, marijuana tax revenue for the first full year of adult-use sales totaled $69.8 million – about $20 million more than officials had projected – with the last four months of the fiscal year especially strong.

Transaction Details

The transaction is valued at approximately $290 million, with $52 million to be paid in cash and approximately 20.8 million Subordinate Voting Shares of GTI. The purchase agreement also includes additional consideration upon performance targets and regulatory license awards. The transaction was unanimously approved by the Board of Directors and expected to close in the first half of 2019, subject to customary regulatory approvals.

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