Eversheds Sutherland Advises Chicago Atlantic on Transformative Merger Agreements in the Cannabis Industry

The merger agreements with Wholesome and Proper include the acquisition of Arches, a cutting-edge analytics and distribution technology platform joint venture between Wholesome and Proper. In addition, the Company signed a binding memorandum of understanding to acquire The Flowery (Florida).

The combined entity (assuming Vireo completes all of the merger transactions) will span seven states, managing approximately 1,043,500 square feet of cultivation and manufacturing space across nine cultivation facilities, and operating 48 retail dispensaries. Supported by Chicago Atlantic, Vireo announced a $75 million equity securities offering at $0.625 per Vireo subordinate voting share, with closing subject to customary approvals, valuing the total deals collectively at approximately $397 million.

John Mazarakis, co-founder of Chicago Atlantic, has been appointed CEO and Co-Executive Chairman of Vireo.

As CEO, John Mazarakis will lead Vireo in creating the first comprehensive platform for cannabis operators. His mission is to empower operators to build sustainable, profitable businesses while preserving their unique cultures and addressing regulatory and capital challenges.

Mr. Mazarakis brings a wealth of experience in cannabis and business operations. At Chicago Atlantic, he has overseen over $2 billion in cannabis-related investments and led the public listing of one of the first cannabis-focused mortgage REITs (Nasdaq: REFI) in 2021. His entrepreneurial career spans 25 years, during which he built and operated 35+ restaurants, developed over 1 million square feet of commercial real estate, and scaled a food distribution business from $12 million to $90 million in annual revenue in under two years.

Vireo currently has operations in three states, Minnesota, Maryland, and New York, and if consummated, the transactions would add four single-state operators, namely The Flowery (a fast-growing high-end premium producer from Florida), Proper Cannabis (a leading operator in Missouri), Deep Root Harvest (a leading operator in Nevada), and WholesomeCo Cannabis (a leading operator in Utah).

Together, Chicago Atlantic and Vireo have established a robust platform with an industry-leading balance sheet, strong profitability, and a compelling growth profile positioning it for success in today’s evolving cannabis landscape.

Read Chicago Atlantic’s press release here. 

Eversheds Sutherland’s deal team was led by Partner Craig Alcorn (Corporate) and Counsel Doyle Campbell (Corporate) with support from Partner Hunter Raines (Corporate) and Partner Owen Pinkerton (Capital Markets).