Exclusive Interview with Verano Co-Founder, Chairman and CEO George Archos
George Archos, the Co-Founder, Chairman and CEO of Verano Holdings (CSE: VRNO) (OTC: VRNOF), last spoke with New Cannabis Ventures in the summer of 2020. Since then, Verano has gone public and has actively pursued M&A. Archos caught up with New Cannabis Ventures to discuss the company’s recent acquisitions and how Verano is positioning itself for continued expansion. The audio of the entire conversation is available at the end of this written summary.
Multistate operator Verano has vertical operations across states like Illinois, Florida, New Jersey, Maryland, Arizona, Ohio and Nevada. It will soon have vertically integrated operations online in Massachusetts. The company is operational in 11 markets, and it will have a footprint in 14 states following the close of pending acquisitions.
Cultivation is core to the company’s foundation, experience built over the past seven years, according to Archos. Verano has several large facilities across its footprint, and it is scaling as its markets grow.
On the retail front, the company has 56 operational stores across its footprint. It will be adding more stores with its pending acquisitions.
The AltMed Merger
The AltMed deal is a merger in Archos’ view. The deal comes with a talented team that has built a successful company with a culture similar to Verano’s. John Tipton and Michael Smullen have built a strong business and brand with AltMed, according to Archos.
The combination of the two companies gives Verano more operational bandwidth. In such a new industry, it is difficult to source and hire talent. But, AltMed comes with a talented team, as well as large-scale operations in the key Florida and Arizona markets. The integration process has been a smooth one, according to Archos.
Last month, Verano announced more acquisitions in Arizona, Illinois and Pennsylvania, pending regulatory approval. The Arizona acquisition will add more talent and another dispensary to the company’s footprint.
The Illinois deal will add a Chicago dispensary to the company’s presence in the state. Plus, Verano will have the ability to open an additional store in the West Loop area of the city.
In Pennsylvania, the company will be gaining three of the state’s busiest dispensaries and a license to build three more stores.
Verano began trading publicly on February 17th and is now listed on the CSE. The ability to invest in more M&A was one of the main reasons the public decided to go public, according to Archos. The company is looking at some tuck-in acquisitions across its current footprint, and it will likely focus on going deeper into its existing 14 markets.
Archos is excited about the prospect of bringing on additional shareholders and continuing the company’s strategic and profitable growth.
Funding for More M&A
In February, Verano announced a C$100 million private placement, which will help to fund additional M&A activity. The company will be looking to deploy that capital strategically, targeting highly accretive assets, according to Archos.
When the company sets out to secure more capital, it has options. The company has a small amount of debt, so bringing on additional debt could make sense, according to Archos. The company could also go out to raise more capital. It has more than enough funds to operationalize its current assets; additional funding would go toward purchasing additional assets.
A Bright Future
Verano is profitable and cash-flow-positive. It has been growing quarter over quarter, and Archos expects that growth to continue going forward, though he wasn’t able to provide forward guidance. The team tracks metrics like cultivation yields, manufacturing yields, margins and product quality to keep the company on track as it grows.
Regulatory delays continue to be an industry challenge, but Archos is confident in the operational talent of the combined Verano and AltMed teams. Newly legal for adult-use markets like Arizona and New Jersey stand out as major growth opportunities for the company going forward.
To learn more, visit the Verano website. Listen to the entire interview:
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