Curaleaf stock dropped into the red today despite Curaleaf Holdings (CSE:CURA) (OTCQX:CURLF) announcing the expiration of the necessary waiting period ahead of its proposed acquisition of private cannabis firm Grassroots.
Grassroots Deal Moves Closer
In a statement released Thursday, Curaleaf Holdings announced the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 had expired ahead of its planned takeover of GR Companies Inc, otherwise trading as Grassroots, with both firms continuing to work together to receive the necessary regulatory and state requirements to close the deal in Spring 2020. Despite the deal moving a step closer, Curaleaf stock has dropped about 1.5% on Thursday.
"We are thrilled to reach this milestone as we progress towards the transformational acquisition of Grassroots," said Joseph Lusardi, CEO of Curaleaf Holdings. "Upon closing, Curaleaf will gain a strong foothold across key states in the Midwest, increasing access for patients and customers to our industry-leading brands. We will continue to focus on executing on our strategy, while enjoying the benefits of greater scale and brand recognition across both new and existing markets." Curaleaf stock is currently trading for $7.82.
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Will 2020 Be a Big Year for Curaleaf Stock?
The acquisition continues Curaleaf's impressive expansion strategy in recent months, which has solidified the company's stance as one of the largest cannabis operators in the US in terms of operational and wholesale footprint, with 53 open dispensaries, 15 cultivation sites, and 24 processing sites across 14 states. Last week, Curaleaf stock popped after the company completed its takeover of cannabis vape maker Select, which presents an opportunity for the Massachusetts-based firm to enter highly lucrative markets on the West Coast.
After reaching a 52-week low in November, Curaleaf stock rallied over the winter months and made gains of nearly 20% in January. However, market uncertainty likely prompted by the impact of the coronavirus on the global supply chain and exacerbated for cannabis companies by the struggles of the Canadian pot market have seen Curaleaf Holdings retreat from those gains in recent weeks. 2020 is shaping up to be a pivotal year for cannabis companies, both north and south of the border, with political uncertainty regarding the US election sure to be a catalyst in the coming months.
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