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MINNEAPOLIS - Cannabis company Vireo Growth Inc. (CSE:VREO; OTCQX:VREOF), which has seen its stock surge over 34% in the past week and maintains a market capitalization of approximately $552 million, announced Thursday it has entered into definitive agreements to acquire approximately 86% of the outstanding senior secured convertible notes of U.S. multi-state cannabis operator Medicine Man Technologies Inc., which operates as Schwazze.
According to the press release, Vireo will acquire the notes at a price "substantially below par value" for total consideration of approximately $62 million. The payment will be made in subordinate voting shares of Vireo at closing, at a deemed price per share of $0.54. InvestingPro data shows the company operates with a moderate debt level and has achieved revenue growth of 25.24% over the last twelve months.
The transaction is expected to close later this month, subject to customary conditions including receipt of necessary approvals.
Vireo Growth, founded in 2014 as a medical cannabis company, describes itself as building a "disciplined, strategically aligned, and execution-focused platform" in the cannabis industry. The company states it operates with a long-term mindset and focuses on deploying capital and talent where it believes it will drive the most value. According to InvestingPro, the company maintains a "GOOD" overall financial health score, with 10+ additional insights available to subscribers.
The announcement comes as part of Vireo’s stated strategy of market focus while leveraging the strength of a national portfolio.
No specific details were provided regarding how the acquisition would affect either company’s operations or what percentage of Schwazze’s total debt the notes represent.
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