"The acquisition of Medicine Man further solidifies Columbia Care's position as a scaled retailer, cultivator and manufacturer in Colorado, the world's second-largest cannabis market. Medicine Man is outperforming the broader Colorado market, with sales growth of 42% in 2020, versus 24% for the state and 64% year-to-date through May, versus 25% for the state. The acquisition will add one cultivation facility and four dispensaries, including one co-located adult-use and medical location and three adult-use facilities to Columbia Care's national footprint.
"We have great admiration for what Medicine Man's leaders, Sally Vander Veer and Andy Williams, have built over the past 12 years through their tireless leadership, local and state-level advocacy and exceptional business acumen and vision,” said Nicholas Vita, CEO of Columbia Care. "Medicine Man will further cement our position as the leading vertically integrated operator in Colorado, in tandem with our ongoing integration of The Green Solution and will have a positive impact on our financial performance for years to come. We are also confident that the strong alignment of values between our two companies will help Columbia Care continue its growth in Colorado sustainably and responsibly. We are thrilled to bring one of Colorado's longest-running and most highly respected cannabis companies into the Columbia Care family."
Medicine Man brings a highly experienced and talented team of executives and employees that further bolsters Columbia Care's strong talent pool. The company's founders and management team are pioneers of Colorado's legal cannabis industry. Over the past 12 years, they have built a widely regarded, highly profitable business that has earned strong loyalty amongst its customers and employees. Because of this, Medicine Man has been recognized as a best-in-class retailer, employer and cultivator through numerous awards.
Andy Williams, Medicine Man's president and co-founder, stated: "Since 2009, the Medicine Man family has helped to pioneer the cannabis industry in Colorado. We have done it responsibly and vigorously for our customers, employees and our family. Our industry is changing and growing now faster than ever. We recognize the need to partner with others in order to continue to compete within, and help to responsibly transform, the industry as it grows. We are proud to be joining our businesses with Columbia Care, a true leader in this next phase of growth in the cannabis industry. Columbia Care is made up of people with family business values and has the horsepower to lead the cannabis industry into the future. We are truly excited to be part of this new team."
"Medicine Man is thrilled to announce our partnership with Columbia Care," said Sally Vander Veer, CEO of Medicine Man. "They are an ideal partner, and I am confident in their ability to uphold the higher standards that our family-owned and operated cultivation and dispensaries have built over the past twelve years. I knew this opportunity was the right fit for our family and employees because of our shared commitment to operational excellence, emphasis on employees and culture, and a customer-first mentality. I look forward to a seamless integration and an exciting next chapter of growth and success."
The upfront consideration of $42.0 million, comprising $8.4 million in cash and $33.6 million in stock, represents a multiple of approximately 4.5x projected 2021 EBITDA. The transaction terms also include a potential additional milestone payment in 2022 if specific performance targets are met.
