Vertically built-in California hashish operator Lowell Farms bought its Monterey County processing plant for $19.4 million to New Wilston Associates and entered a leaseback settlement with the corporate.
Underneath phrases of the deal, Lowell signed a 10-year lease on the 10-acre website, which features a 40,000-square-foot facility the place it cultivates and processes marijuana for its personal manufacturers and third-party companions, in keeping with a information launch.
Lowell acquired the operation in 2021 for $19.2 million.
As a part of the deal, Connecticut-headquartered New Wilston will assume the excellent principal on the mortgage, accrued unpaid curiosity and different liabilities totaling $10.3 million.
Lowell stated within the launch that it expects to realize about $3.5 million after closing and different transaction-related prices.
“The sale leaseback is only one a part of our ongoing restructuring efforts to implement value chopping measures and drive efficiencies as a way to finest place the corporate to drive worth for our shareholders,” Lowell’s board chair, Ann Lawrence, stated in a press release.
The sale comes on the heels of a difficult first quarter for Lowell, which posted a 39% drop in year-over-year gross sales to $7.5 million and an working lack of $2.3 million – in contrast with a $2.5 million loss a yr in the past.
Lowell is a founding member of a brand new coalition of California hashish corporations aiming to lift consciousness and supply options to mitigate a credit score disaster threatening to upend the native marijuana trade.
Monetary Stability for California Hashish, which launched final week, is comprised of dozens of hashish manufacturers, wholesalers and producers aiming to confront advanced debt issues dealing with the world’s largest regulated marijuana market.