urban-gro adds in-house design-build solutions with $7 million acquisition – New Cannabis Ventures
urban-gro, Inc. to acquire Emerald Construction Management, Inc., adding in-house design-build solutions to its global in-house CEA service offerings
- Highly synergistic 20-person company transaction enables urban-gro to supply complete turnkey installations to the global indoor CEA market
- Adds in-depth construction management experience and delivery capabilities supported by on-site project management
LAFAYETTE, Colo., March 14, 2022 (GLOBE NEWSWIRE) — urban-gro, Inc. (Nasdaq: UGRO) (“urban-gro” or the “Company”), an architectural, engineering systems integration company and fully integrated culture focused on the Controlled Environment Agriculture (“CEA”) domestic market, today announced that it has entered into a definitive agreement to acquire Emerald Construction Management Inc. (“Emerald CM”), a 37-year-old Colorado-based construction management company providing comprehensive construction services. and supervision services from initial design to final construction. Emerald CM forecasts 2021 revenue of $26.5 million and adjusted EBITDA of $1.2 million. The total purchase price for the transaction, including a maximum contingent earnout of $2.0 million, is $7.0 million. urban-gro will fund the transaction with a combination of $2.5 million in cash and up to $4.5 million in equity. The transaction is expected to close within 60 days, pending successful due diligence, and the Company expects the acquisition to be immediately earnings accretive in 2022.
The acquisition of Emerald CM represents an important step in our strategy to provide the global indoor CEA market with turnkey designed and built facilities. The market for mid-size turnkey grow facilities and vertical farms is underserved, providing urban-gro with a unique opportunity to bring the expertise and experience needed to deliver successful facilities.
Bradley Nattrass, president and CEO of urban-gro
This acquisition allows us to bring our customers to market faster while maintaining elite levels of service.
Nattrass continued, “Beyond the completion of our turnkey strategy, the addition of Emerald CM’s contracts and project pipeline provides us with additional opportunities to generate significant revenue streams by providing our services and current equipment solutions to existing Emerald CM customers. Coupled with our strong balance sheet and positive cash flow, we are in an ideal position to continue our momentum in the global CEA industry while simultaneously enhancing shareholder value.
Today, many controlled-environment agricultural businesses are serviced by a variety of vendors, many of whom lack the human resources, systems maturity, and financial stability to meet the demands of large, complex construction projects.
Jim Dennedy, president and chief operating officer of urban-gro
The acquisition of Emerald CM not only strengthens our capabilities and service offerings, but also enables us to provide our customers with a single point of accountability to manage their project needs.
Christopher Cullens, CEO of Emerald CM, concluded, “This union will bring immense value to all of our CEA and non-CEA customers as they will be able to take advantage of the expertise, scale and full suite of professional services that urban centers great offers. We have developed a strong partnership with urban-gro, and I couldn’t be more excited for our customers and my team to experience what the combined company will offer. There is a gap in the global CEA industry, specifically with the design and construction of mid-sized indoor CEA facilities, and now we have the perfect solution to fill it.
About Emeraude CM
Emerald CM, Inc., located in Centennial, Colorado, has extensive and diverse experience in providing a multitude of construction services. As a provider of design-build services, Emerald CM has built a solid reputation with its clients and a network of reliable architects, engineers, contractors and suppliers. Emerald CM specializes in providing comprehensive design-build and construction management services and serves as a single point of accountability for all of its clients’ construction needs.
About urban-gro, Inc.
urban-gro, Inc.® (Nasdaq: UGRO) is a fully integrated architectural, engineering and cultivation systems integration company for commercial cannabis and controlled environment agriculture (“CEA”) facilities food oriented. Drawing on our experience in hundreds of CEA installations spanning millions of square feet around the world, we design, engineer and integrate complex environmental equipment systems into high-performance facilities. urban-gro’s gro-care® managed services platform leverages the company’s expertise to reduce downtime, ensure continuity and drive facility optimization. Operating as a crop-neutral solution provider to the CEA food and cannabis sectors, our end-to-end crop-centric approach provides a single point of accountability for all aspects of cultivation operations. To visit urban-gro.com to find out how we help growers green plants and big profits.