Case in point: Florida-based cannabis company Trulieve (TCNNF) set a new record Monday with its $2.1 billion all-stock deal to acquire Arizona-based Harvest Health. The combination sets Trulieve up to increase its national footprint from six states to 11, and sets it up to be the most profitable multi-state operator with adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) forecasted to top $460 million on the year.
It also goes to show how much America's largest cannabis companies are willing to pay to gain access into states that recently legalized marijuana, like Arizona, since federal laws still restrict operating across state lines. As Trulieve CEO Kim Rivers told Yahoo Finance, sometimes it can make sense to build in a new state from the ground up — but with Harvest's lead in Arizona, which only started recreational marijuana sales in 2021—sometimes it makes more sense to buy the leader.