Limited Buyer Universe
– Due to regulatory caps in the Pennsylvania market, understanding the relevant buyers’ existing assets and regional focus allowed for efficient discussions
Conflicting Board Level Interests
– Managing conflicting interests and ensuring the best outcome for all parties involved convincing non-cannabis focused stakeholders that bid levels were fair relative to specific cannabis market conditions
Initial Bid Retrade
– The initial bidder attempted to negatively adjust purchase price, but our banking team successfully pivoted quickly to other interested parties
Create Differentiated Demand
– Given limited buyer universe and depth of available retail in Pennsylvania, focusing on the strength of the stores relative to competition and attractive MSA demographics piqued buyer interest
Structured Auction Process
– Managed a firm process and bid deadline, resulting in initial bids 25% higher than seller expectations and pre-existing offers
Nimble Adjustments
– As initial bidder backed out of process, we were able to structure a narrow follow-up auction that drove the successful bid to a similary attractive value
The Results
Cresco’s acquisition of three retail in Pennsylvania was a logical fit as they sought to complete their Pennsylvania retail portfolio
Structuring Preparedness – Deal team members educated the shareholders of Cure Pennsylvania related to the quality of stock consideration relative to bid values and drove buyers’ willingness to submit significant cash consideration
Value Maximization – Via creative EBITDA adjustments and analysis into short-term competitor discounting, the deal team was able to hold potential bidders’ positions and maximize enterprise value
Transaction
M&A Advisory
PGP acted as M&A advisor to Cure Pennsylvania in consummating this transaction
