The deal is intended to expand the company’s European reach.
Curaleaf Holdings, Inc. (TSX: CURA) (OTCQX: CURLF) has its sights set on Europe and is buying Northern Green Canada (NGC) for expansion purposes. The deal is expected to close in the second quarter of 2024 and the value of the acquisition was not disclosed.
NGC is a vertically integrated Canadian licensed cannabis producer that is one of the few Canadian cultivators with EU-GMP certification. It has consistently supplied high-THC, non-irradiated flower to the German market, which is expected to see exponential growth following the recent removal of cannabis from the narcotics list. NGC is also increasingly supplying Australia and New Zealand, the world’s fastest-growing cannabis markets.
“We expect the NGC acquisition to be a highly accretive deal that marks Curaleaf’s first step into the Australasian markets, creating a true global cannabis company with global brands,” said Executive Chairman Boris Jordan. “It allows Curaleaf to safeguard our position in Europe, enhancing our supply chain while increasing our margins. The opportunity in Germany alone cannot be understated, and we continue to prepare strategically for that moment and beyond.”
Curaleaf said in a statement that buying NGC will significantly increase its European margins while extending its global footprint across three continents: North America, Europe, and Australasia (Australia/New Zealand). According to Curaleaf, the deal will solidify the company’s leading position in the German market during a critical juncture, while also allowing the company to maintain its leadership position in the U.K. and expand its first-mover advantage into Poland.
Juan Martinez, Head of Curaleaf International, added, “The NGC deal complements our Portuguese cultivation and processing assets, which we continue to expand and develop. With the addition of NGC’s indoor non-irradiated flower, coupled with existing production from Portugal that can be quintupled as demand dictates, Curaleaf will have ample high quality GMP supply and future expansion capacity to meet growing market needs. We anticipate other EU countries to follow Germany’s lead in advancing their medical cannabis programs to increase patient access.”
NGC was the first privately-owned Canadian licensed producer of cannabis to have EU GMP certification and in 2023 over 95% of its revenue was attributed to international markets. NGC’s facility has both ample space and regulatory certification available for modular build-out of additional grow rooms, allowing for increased capacity. NGC also partners with Canadian GACP cultivators to produce and distribute finished cannabis products to both the domestic and global markets.
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