Adam Jackson
Body and Mind Inc. (CSE: BAMM) (OTCQB: BMMJ) agreed to sell its Ohio dispensary for more than $8 million, the company announced Monday.
Under the deal, led by DEP Nevada Inc., a wholly owned subsidiary of Body and Mind, FarmaceuticalRX LLC acquire Body and Mind’s Ohio dispensary, NMG OH 1, LLC.
The sale is part of Body and Mind’s ongoing strategy to enhance its operating flexibility as it focuses on its other statewide stakes. The company also recently left the Michigan market.
Under the terms of the equity purchase agreement, FarmaceuticalRX will acquire all issued and outstanding interests in NMG OH. The transaction is valued at $8.225 million in cash at closing, with the potential for an additional $2.5 million in contingent proceeds.
The Ohio dispensary, which opened in 2019, represents Body and Mind’s first foray into dispensary operations. While the company said it is proud of its growth in Ohio, it is monetizing the asset to focus on the developing markets in New Jersey and Illinois.
“We constructed and opened the Ohio dispensary soon after the Ohio medical program commenced and developed significant retail capabilities since 2019,” Trip Hoffman, COO of Body and Mind said in a statement.
“While I have some disappointment divesting the Ohio dispensary and saying goodbye to the team, I’m excited about our current developing opportunities in Illinois and New Jersey and creating flexibility to evaluate new opportunities,” Hoffman added.
Cannabis medical dispensary chain FarmaceuticalRX, which got its start in Pennsylvania, sees the acquisition of the Ohio dispensary as an opportunity to increase its retail presence and serve more patients in the state. The company already operates a dispensary in East Liverpool and has another dispensary set to open in Cuyahoga Falls.
The closing of the transaction is set for the first day of the month following the receipt of regulatory approval from the state of Ohio, as well as the satisfaction or waiver of all other closing conditions.
Any future additional dispensary licenses granted to NMG OH by the State of Ohio Board of Pharmacy could yield DEP a bonus payment of up to $2.5 million per license. However, that contingency excludes any adult-use license for the existing license held by NMG OH at the current lease location, according to a release.
