- TerrAscend (OTCQX: TSNDF) plans to exit the Michigan cannabis market by the second half of 2025, divesting all related assets.
- The strategic exit will affect 21% of its workforce, approximately 250 employees, and is expected to improve financial metrics.
- Proceeds from the sale will be used to pay down existing company debt, enhancing the balance sheet.
TerrAscend Corp. (OTCQX: TSNDF), a prominent North American cannabis enterprise, has announced its decision to strategically exit the Michigan cannabis market. The company intends to sell its Michigan assets, which include four cultivation and processing facilities, twenty retail dispensaries, and associated real estate. The divestiture is anticipated to be completed in the latter half of 2025. This move is part of an extensive strategy aimed at optimizing resource utilization in its core northeastern U.S. markets and Toronto, Ontario.
By refocusing efforts on states such as New Jersey, Maryland, Pennsylvania, Ohio, and California, TerrAscend expects to strengthen its financial performance. This strategic shift is projected to result in improvements in key financial metrics, including gross margin, adjusted EBITDA, and cash flow conversion. The exit from Michigan will also lead to a reduction of approximately 21% in the overall workforce, impacting about 250 employees from a total staff of 1,200 as of June 30, 2025.
Net proceeds from the Michigan asset sales will be used to reduce the company's current debt, and the Michigan operations will be reported as discontinued from the second quarter of 2025. Executive Chairman, Jason Wild, noted that the Michigan market is exceptionally challenging and that resources would yield better returns in other markets, thus unlocking greater value for the company and its shareholders.
The decision aligns with TerrAscend's long-term growth objectives and is expected to lead to a strengthened balance sheet, paving the way for potential strategic acquisitions and enhanced operational efficiencies.
