Grown Rogue International Inc. has entered into a joint venture agreement worth $10 million to acquire PharmaCann Inc.'s New York assets, including four dispensaries. This strategic move signals Grown Rogue's expansion and capitalizes on a growing market opportunity in New York's cannabis sector.

Key Highlights

  • The group plans to finalize definitive purchase agreements within four weeks for the Acquisition of PharmaCann's Assets and operational transition strategies.
  • On August 20, 2026, Grown Rogue formed Grown Rogue New York, LLC, through a joint venture agreement with a capital partner, establishing a 51% to 49% ownership structure.
  • Grown Rogue has entered into a Goods and Services Agreement with PharmaCann to oversee its operations during the transition period, a important step aimed at maintaining Business continuity.

This initiative is expected to significantly broaden Grown Rogue’s market presence in New York, where it will acquire four Verilife-branded dispensaries and a cultivation facility, laying the groundwork for production and sales in the growing cannabis market.

Joint Venture Details

On August 20, 2026, Grown Rogue formed Grown Rogue New York, LLC, through a joint venture agreement with a capital partner, establishing a 51% to 49% ownership structure. The capital partner contributed $10 million in exchange for preferred equity, which earns an annual distribution starting at $1 million in the first year and rising to $2 million subsequently. Grown Rogue will receive a matching distribution, and any excess Cash Flow will be divided based on ownership percentages.

This structure not only affirms the financial backing needed for the New York market entry but also allows for future capital generation through the sale and conversion of equity.

Financing Structure

Under the terms of the venture, the capital partner’s preferred Equity is slated for conversion into approximately 18.2 million subordinate voting shares at a conversion price of $0.55 per share, reflecting an anticipated dilution of about 7%. A $5 million drawable term Loan at a 15% Interest Rate has also been committed to support further operational needs and transitional expenses related to the acquisition.

Operational Transition Strategy

Grown Rogue has entered into a Goods and Services Agreement with PharmaCann to oversee its operations during the transition period, a important step aimed at maintaining business continuity. This agreement allows Grown Rogue to manage day-to-day operations and allocate capital effectively while ramping up the production capacity at the Hamptonburgh facility. This operational strategy is vital for capitalizing on the existing sales momentum amid the backdrop of transitioning to a larger scale of operations.

Strategizing for Future Growth

The joint venture is positioned to execute definitive purchase agreements for the New York assets within approximately four weeks, pending the necessary regulatory approvals. The anticipated purchase price is about $4.5 million, which will be partially payable upon regulatory approval of the transaction. This quick-moving strategy not only aims to preserve operating capital but also prevents any significant disruption to existing employment levels, allowing Grown Rogue to retain talented personnel from the PharmaCann team.

Grown Rogue's aggressive plan to pivot into New York's market leverages the strong operational infrastructure left behind by PharmaCann, providing an expedited pathway for achieving future growth and market penetration.

Grown Rogue International (OTC: GRUSF) is set to enhance its industry footprint, and key operational decisions and the upcoming finalization of acquisition agreements will be essential to watch as the company navigates its strategic entry into New York's competitive cannabis environment.

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