Green Growth Brands Expands its Multi-State Operations into Arizona

Published: February 4, 2019

Green Growth Brands Expands its Multi-State Operations into Arizona

Green Growth Brands Inc. announced that it executed an arm’s length definitive agreement to acquire control of ZLJT LLC & Arizona Natural Pain Solutions Inc, collectively referred to as “Desert Rose”. Desert Rose holds a license for a vertically-integrated operation in Arizona, including retail, cultivation & infusion (kitchen). As consideration for the membership interests, GGB will pay an aggregate purchase price of USD$12,350,000 (CAN$16,292,120) in cash.

“We were very impressed with the quality of the operations held by Arizona Natural Pain Solutions,” said Green Growth Brands CEO Peter Horvath. “At Desert Rose, the team is dedicated to providing their customers with medical marijuana products that are pure, safe, and efficient while striving to keep their costs as affordable as possible. This strategy fits perfectly with our plans to grow the world’s premier cannabis retailing business.”

Desert Rose, located on the corner of 7th Ave and Happy Valley Road, close to the Norterra shopping center, was founded in August 2016 and has grown to serve nearly 400 patients per day. Desert Rose specializes in top-tier flower, vape pens, concentrates, edibles and tinctures. Desert Rose has over 237 reviews on Google and a 4.7/5 star rating and offers a loyalty program where customers earn back 1% of their purchases to be spent in the dispensary.

“The retail operations at Desert Rose fits our stated strategy of favoring large sales volume with high-productivity assets,” added Horvath. “Our vision of Green Growth Brands is to be a multi-state operator with stores averaging USD$15 million to USD$20 million in annual sales, driven by per square foot sales in excess of USD$10,000. This is what our first assets in Nevada and this store in Arizona have achieved.”

The state of Arizona currently restricts cannabis consumption for medical use but appears to be moving towards legalizing recreational use. According to the Arizona Department of Health Services, marijuana sales in the state reached almost 122,000 pounds in 2018, a 41% increase over 2017, with over 186,000 registered medical marijuana patients as of December 2018.

Completion of the acquisition is expected to occur in February 2019 and remains subject to regulatory approval, customary conditions of closing and the satisfactory completion of due diligence by the Company.

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