Vireo Growth Closes Deep Roots Harvest Acquisition in Nevada
Deal News | Jun 09, 2025 | Globenewswire
Vireo Growth Inc., a pioneering company in medical cannabis, has announced the completion of its acquisition of Deep Roots Holdings, Inc., a prominent Nevada-based cannabis operator. The transaction is valued at $132.7 million, paid through 255.2 million Subordinate Voting Shares of Vireo. The deal represents a 4.175x multiple of Deep Roots' projected EBITDA for 2024, which stands at $30 million. Deep Roots operates a significant cultivation and manufacturing facility along with ten retail dispensaries in Nevada. It also holds investments in enterprises in California, Ohio, and Massachusetts. This strategic acquisition aligns with Vireo's growth agenda in the cannabis sector, marked by a disciplined approach to capital allocation and local market empowerment. Shareholders of Deep Roots have agreed to share unlock provisions over a period of 33 months, linking future financial performance with shareholder benefits. Future performance risks and regulatory approvals remain critical aspects of the transaction.
Sectors
- Cannabis
- Mergers and Acquisitions
- Financial Services
Geography
- United States – The acquisition involves companies operating in the U.S., specifically highlighting operations in Nevada, with extensions into California, Ohio, and Massachusetts, reflecting diverse geographical market engagements within the U.S.
- Nevada – Nevada serves as the primary focus, being the base of Deep Roots Harvest and a mature cannabis market. The acquisition significantly impacts the market dynamics in this state.
Industry
- Cannabis – The article primarily focuses on the cannabis industry, as Vireo Growth Inc. and Deep Roots operate in this rapidly growing sector. It highlights the consolidation and the strategic significance of acquiring operations in mature cannabis markets like Nevada.
- Mergers and Acquisitions – The article revolves around a major acquisition deal where Vireo Growth Inc. acquired Deep Roots Harvest, illustrating a strategic M&A activity within the cannabis industry.
- Financial Services – The financial structure of the acquisition, including the valuation, EBITDA multiple, and share arrangements, addresses aspects typical within financial services related to corporate transactions and investments.
Financials
- $132.7 million – Total consideration for the acquisition of Deep Roots Holdings, paid in the form of Subordinate Voting Shares of Vireo.
- 4.175x – The EBITDA multiple used to value Deep Roots Holdings in the acquisition.
- $30 million – The Closing EBITDA for Deep Roots Holdings used to calculate the acquisition multiple.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Vireo Growth Inc. | Bidding Company | Company | A leading operator in the cannabis sector, expanding its footprint through strategic acquisitions. It was founded in 2014, known for its focus on medical cannabis. |
| Deep Roots Holdings, Inc. | Target Company | Company | A robust cannabis operator based in Nevada, known for its cultivation, manufacturing facilities, and retail dispensaries. The company was established in 2023. |
| Joe Duxbury | Executive Contact | Person | Chief Accounting Officer of Vireo Growth Inc., responsible for financial oversight in the acquisition. |