Columbia Care Expands Southern California Presence Through Acquisition of The Healing Center San Diego

Columbia Care Inc. (NEO: CCHW) (CSE: CCHW) (OTCQX: CCHWF) (FSE: 3LP) (“Columbia Care” or the “Company”) announced today it has acquired The Healing Center San Diego (“THCSD”), one of the leading dispensaries in Southern California, for approximately $15.0 million.

An accretive transaction for shareholders, total consideration includes $3.0 million in cash, $6.0 million in Columbia Care stock and $6.0 million in seller promissory notes. Excluding any revenue or margin synergies, the purchase price represents approximately 1.2x and 4.7x estimated 2021 revenue and Adjusted EBITDA, respectively. Since its founding, THCSD has consistently generated revenue growth, as well as positive Adjusted EBITDA and free cash flow.

THCSD, founded by Ray Taylor and Jim Dickinson, opened its doors in 2016 as one of the first dispensaries to operate in San Diego, a limited license market. Offering a wide selection of products, high touch customer service, outstanding access and an expanded sales floor that will be open soon, THCSD continually receives some of the highest online customer ratings in California’s second largest metropolitan market.

Acquiring THCSD enhances Columbia Care’s retail presence and scale in California, further leveraging the existing world class manufacturing capabilities of its Balboa facility and the cultivation, retail, portfolio of market leading brands, and wholesale distribution of its recent acquisition, Project Cannabis. The Company, one of the leading, fully integrated operators in the state, now has three dispensaries and one state-of-the-art indoor cultivation facility in Los Angeles; two dispensaries and one GMP quality manufacturing facility in San Diego; several acres of outdoor cultivation capacity in Desert Hot Springs; and one dispensary in San Francisco. The Company also has state-wide distribution and wholesale relationships with more than 100 dispensaries.

“Expanding the retail footprint in our operational markets enhances scale, improves consumer access, leverages Columbia Care brands, drives margin expansion through the supply chain and delivers outsized shareholder returns – pillars of our stated growth strategy. Being a leader in California enables us to continue building brand equity and awareness across our product portfolio and solidify consumer loyalty and trust, which are the cornerstones of our success,” said Nicholas Vita, CEO of Columbia Care. “THCSD has been a cannabis bellwether since its founding and has built a business with a loyal customer base. We are thrilled they have entrusted us to accelerate the excellence THCSD is known for. We share a mutual commitment to quality and customer service, and THCSD customers can expect that to continue. We are proud to add THCSD and its team to our organization and further strengthen our leadership position in the world’s largest cannabis market.”