iAnthus Capital Holdings Inc. (CNSX:IAN) has closed its investment in Reynolds Greenleaf & Associates LLC, a medical cannabis management company in New Mexico, and converted an existing loan into preferred equity in RGA.
RGA has management agreements in place with three vertically integrated, non-profit medical cannabis licence holders and one for-profit manufacturer licensee. The clinics managed by RGA collectively have a current 16% share of the market for medical cannabis sales, the largest in the state.
iAnthus has converted its existing $2.3mln loan facility into preferred equity in RGA. The loan facility was initially financed by iAnthus in January, and RGA has used the proceeds to date for the expansion and upgrade of its cultivation operations, launching a dispensary expansion program throughout New Mexico, and for working capital and other general corporate purposes.
iAnthus may invest additional funds over the next several months as RGA further executes on its expansion plans.
“New Mexico has been at the forefront of providing access to medical cannabis and there remains a large market opportunity throughout the state, with limited competition due to a cap on the number of authorized licence holders. RGA is a proven market leader and its revenue has been growing rapidly since its founding in 2014,” said Randy Maslow, president of iAnthus.
“RGA is an important part of our strategy to invest in leading operators across multiple favourable regulated cannabis markets in the United States.”
William Ford, RGA’s founder and managing director, added: “Partnering with iAnthus will allow us to implement our growth strategy to expand our clinical operations, as well as complete development of a production strategy to provide value-added cannabis-infused products for our licence holders and others in New Mexico.”
RGA has management agreements with R. Greenleaf Organics, Medzen Services, G&G Genetics, and Elemental Kitchen and Laboratories. It currently manages a production facility, three cultivation operations with a total of 1,350 plants, as well as four clinic locations in Albuquerque. The clinics managed by RGA collectively constitute the market share leader for medical cannabis sales in the state.
Story by ProactiveInvestors