While uncertainties remain with the company’s planned buyout of Origin House, Chicago-based cannabis company Cresco Labs (CSE: CL; OTCQX: CRLBF) is moving forward with another acquisition.
Cresco is currently in the process of acquiring the Las Vegas-based Tryke Companies, which sells extracts and dried flower products such as Khalifa Kush and Tryke Diamond through the Reef line of dispensaries.
The HSR waiting period mandated by the United States Department of Justice (DOJ) Antitrust Division just expired on that transaction without an additional request for more information.
Now that the waiting period is over, the transaction can move into the next phase and is due to close by Q2 2020. The acquisition will still require approval by state agencies in Arizona, Nevada, and Utah before it can be completed next year.
Commenting on those regulatory hurdles and the company’s strategic rationale behind the purchase, Chief Executive Officer Charlie Bachtell had this to say:
Aside from the Tryke buyout plan, the company’s Origin House acquisition is currently on the rocks as Cresco’s stock price has fallen significantly since the deal was first announced.
Cresco is now trading at half the price from when the acquisition plan was publicly revealed back in April, cutting the value of the deal from the originally announced $1 billion to $500 million.
The HSR waiting period on the Origin House deal also recently ended, allowing it to move forward if neither side pulls out.
In other Cresco news, the company issued an additional 551,250 share purchase warrants last month to raise an extra $1.1 million in capital. Those additional warrants follow a previous underwritten unit offering, with the combined fundraising seeing an influx of more than $74 million.
The funds raised through that over allotment option will be utilized for funding working capital requirements and continued company expansion.