Cannabis M&A Newsletter: Debt Forces Hands as Cannabis Acquisitions Accelerate

Welcome to our first national cannabis M&A newsletter! Where we keep you updated on the latest intel to assist in your expansion efforts. February 2026 cannabis acquisitions were shaped by one dominant force: debt coming due. The month’s headline deal – Millstreet Credit Fund’s $130M loan-to-own acquisition of Cannabist’s Virginia assets confirms that lenders are now competing with MSOs for distressed portfolios. Ayr Wellness lost assets to foreclosure across multiple states including New Jersey and Ohio, while Planet 13 completed its California exit and Key Cannabis picked up three Missouri dispensaries. Six confirmed deals this month, with distressed and debt-driven transactions accounting for the majority of disclosed value.

Don’t miss the bottom of this article where we highlight the 6 hottest cannabis deals our M&A team has access to right now.

🔥 MARKET SIGNALS THIS MONTH:

• Debt-to-equity foreclosure hits NJ and OH simultaneously – Ayr Wellness loses assets to senior note holders across multiple states
• First institutional credit fund (Millstreet) outbids an MSO (Curaleaf) for a major cannabis portfolio – new buyer category enters the market
• Planet 13 completes full California exit – signals continued retreat of smaller MSOs from high-cost, oversupplied West Coast markets

🔥 New Jersey – Foreclosure / Multi-Asset Transfer

Senior note holders acquired Ayr Wellness’s assets and equity interests via foreclosure, with NJ assets including three adult-use dispensaries and the Lakewood cultivation facility; reported credit applied toward purchase was $387M across all affected states. This is the largest distressed event in New Jersey cannabis acquisitions since adult-use launched.

License transfers remain subject to NJ Cannabis Regulatory Commission approval, with operations continuing during the transition.

🔥 Virginia – Distressed Acquisition / Debt-to-Equity

Millstreet Credit Fund LP acquired Cannabist’s Virginia cannabis assets for $130M via a debt-to-equity pathway after the seller entered a forbearance agreement on $270M in senior secured notes; Millstreet outbid Curaleaf by approximately $20M. The deal marks the first institutional credit fund outright winning a cannabis asset auction over an MSO buyer.

Setting a new precedent for how distressed portfolios change hands.

Ohio – Sale-Leaseback / Asset Sale

Parma Propco, an affiliate of Power REIT, acquired Ayr Wellness’s Parma cultivation facility from Aventine (a Chicago-based REIT) for $28.5M; Ayr Wellness continues to operate the facility under a lease agreement with no cannabis license transfer. The deal demonstrates that real estate capital is still moving into Ohio cannabis assets even as SB 56 limits license mobility.

No license transfer required.

Missouri – Retail Acquisition

Key Cannabis acquired three Trinity Cannabis dispensaries in Rolla, St. James, and Salem, with all locations to be rebranded as Key Cannabis. The move consolidates retail footprint in Central Missouri, a region where Key Cannabis has been building market presence.

Deal value was not disclosed.

🔥 California – Divestiture / Multi-Asset Exit

Planet 13 Holdings substantially completed its exit from California, closing the sale of its Orange County retail and distribution operations to Catalyst Cannabis and selling its Coalinga cultivation property. Co-CEO Bob Groesbeck cited operational focus and capital allocation discipline as the drivers.

The cultivation license transfer is still progressing.

International (Canada) – Acquisition (Shareholders Approved)

Canopy Growth Corporation received shareholder approval to acquire MTL Cannabis Corp., advancing a deal that would add licensed Canadian production capacity to Canopy’s portfolio.

No updated valuation was disclosed in the most recent filing.

Millstreet Credit Fund LP acquires Cannabist Virginia assets – $130M

This deal is not just notable for its size. It signals a structural shift in who is buying cannabis assets. Millstreet is a credit fund, not a cannabis company. It entered this transaction through a loan-to-own strategy after Cannabist entered a forbearance agreement on $270M in senior secured notes. The fact that Millstreet outbid Curaleaf, a major multi-state operator (MSO), by roughly $20M tells you something important: institutional debt capital is now pricing cannabis assets higher than some of the most aggressive strategic buyers. Virginia’s adult-use timeline makes this asset particularly attractive – the House and Senate both passed implementation bills this month, with a November 2026 target date. Buyers who can absorb distressed assets at current pricing and hold through the adult-use transition stand to capture significant upside. Expect more credit funds to study this playbook.

Loan-to-own is now a real buyer category. Millstreet outbidding Curaleaf for Cannabist’s Virginia portfolio is not a one-off. With Curaleaf’s $500M refinancing and iAnthus extending NJ bridge notes 16 months, the number of overleveraged cannabis businesses is growing, and lenders are positioning to convert.

Ayr Wellness is being dismantled by its creditors. Between the NJ foreclosure and the Ohio sale-leaseback, Ayr’s asset base is shrinking fast. Watch for additional state-level transfers as regulatory approvals move forward.

California is shedding MSO retail. Planet 13’s exit to Catalyst Cannabis reflects the ongoing retreat of publicly traded MSOs from a high-tax, oversupplied California market. Secondary buyers with lower cost structures are absorbing these assets.

Illinois price compression is accelerating exits. Wholesale prices dropped from $17.50/gram to $5.72/gram (67% decline) with record 2025 volume and lower revenue – a direct pressure on margins that should push more sellers to act in Q1-Q2 2026 before conditions worsen.

Virginia is the near-term acquisition magnet. Between the Millstreet deal, both chambers passing adult-use legislation, and November 2026 as the implementation target, Virginia cannabis M&A is drawing institutional capital ahead of the transition. Buyers not already positioned are running out of time.

🏢 Select Acquisition Opportunities from CannDev

Our M&A team currently has access to turnkey licensed retail dispensaries, microbusiness licenses, and strategic market positions across six states. Below is a curated selection priced for immediate acquisition.

Absecon, NJ Retail Dispensary

Asking: $500k

• Located on road between Atlantic City and Atlantic City Airport
• On track to do $1M+ first year revenue

Toledo, OH Retail Dispensary

Asking: $1.3M

• Must be relocated. Priced at license value only
• Built for a buyer who wants to place it in the right market

Akron, OH Retail Dispensary

Asking: $4.25M

• Net revenue of approximately $850k in 2025
• $8,500 per month rent
• Priced to move

Minnesota General Microbusiness License

Asking: $35k

• Least expensive microbusiness license offered in the state

Peekskill, NY Dispensary

Asking: $2.75M

• Retro inspired cannabis bodega with plenty of parking
• $3.25M revenue last 12 months

Capital Region, NY Dispensary

Asking: $2.5M

• Prime location, high traffic count
• $2.4M+ revenue each of last two years
• Private parking lot

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