Curaleaf Holdings has completed the planned acquisition of the assets of Curaleaf NJ, a vertically integrated medical cannabis non-profit corporation that holds one of the original six medical licenses in New Jersey. Curaleaf Holdings now owns 100% of the Curaleaf NJ, Inc. Alternative Treatment Center ("ATC") operations, assets and licenses in New Jersey, for which it previously provided management services. Following the acquisition Curaleaf will integrate the financial results of the New Jersey medical cannabis business operations into its consolidated financial statements, which were previously reported as managed revenues.
Joseph Lusardi, CEO of Curaleaf, said, "Curaleaf is one of New Jersey's oldest and largest providers of cannabis. The asset acquisition we announced today completes our vertical integration and conversion to a for-profit entity in the state, marking a major milestone for our New Jersey presence. With our strong growth and a cannabis adult-use ballot approval on the horizon, we are actively investing in the expansion of our market leading position to better serve the more than 9 million residents of the Garden State with the quality cannabis products they rely on."
The Curaleaf NJ license and other assets were acquired in exchange for Curaleaf cancelling loans that were used to fund the build out of the previously managed non-profit entity.
Curaleaf's business in New Jersey operates the state's largest medical cannabis dispensary as well as more than 51,000 square feet of cultivation and processing space in Bellmawr, NJ, through its integrated license. In accordance with the recently adopted state regulations, Curaleaf plans to open two additional New Jersey dispensary locations, as well as an additional cultivation and processing operation, for which the Company has secured a facility in the Township of Winslow, NJ, creating hundreds of jobs for the state.
Originally, New Jersey medical cannabis ATCs were required to be operated as non-profit entities. Today's announcement follows changes to the New Jersey Department of Health ("NJDOH") regulatory structure that permitted ATCs to sell or transfer their license to a for-profit entity, with NJDOH approval.
In March 2018, under the direction of Governor Murphy, who campaigned on a platform that included cannabis legalization, the NJDOH issued the Executive Order 6 Report, which immediately expanded the medical cannabis program in numerous ways, including adding chronic pain and anxiety as qualifying conditions, doubling the monthly product limit, and permitting current licensees to open satellite dispensaries. In December 2019, the New Jersey state legislature passed a bill to add an initiative to the November 2020 ballot that will allow voters to decide whether to legalize the sale of adult-use cannabis in the state, providing a potential path for additional state consumer access.