GrowGeneration Corp. (OTCQX: GRWG), GrowGeneration (“GrowGen” or the “Company”), one of the largest specialty retail hydroponic and organic gardening stores, currently with 18 locations serving both commercial and home growers, today announced that it has purchased all of the assets of Central Coast Garden and Farm Supply (CCG) located in Salinas, CA. CCG generated approximately $1.7 Million in revenue in 2017 and will serve as a retail and warehouse location servicing the growing number of commercial cultivators in the Central Coast California market. Central Coast Garden and Farm Supply adds the 5th store to the GrowGen portfolio of stores in California.
GrowGeneration Focused On Aggressive California Expansion
The Central Coast of California, from Santa Cruz to Santa Barbara, has 1,065 cultivation licenses compared to 1,159 in the Emerald Triangle, which is made up of Humboldt, Mendocino and Trinity counties and is about the same size as the Central Coast.
The two regions account for more than two-thirds of all the cultivation licenses in the state, with Los Angeles, Sacramento and other urban counties taking up most of the other licenses for indoor growers.
Hezekiah Allen, a former Humboldt County cannabis farmer who heads the California Growers Association industry group, says Monterey County is attracting growers of “commercial grade marijuana” in a business model akin to major breweries of beer. Under Monterey County rules, marijuana cultivators only can grow in greenhouses in certain areas by converting existing structures or building new ones where old ones used to stand. They can’t plant outdoor farms or otherwise upset the county’s signature $5 billion agriculture economy for leaf lettuce, strawberries, broccoli, cauliflower, celery, artichokes and wine grapes.
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GrowGen continues the execution of its acquisition plans to acquire the leading hydroponic stores, throughout the United States. California continues to present significant growth opportunities for GrowGen, particularly with the adult-use laws going into effect on Jan. 1, 2018. According to New Frontier Data, the California market projects to grow at a compounded annual rate of 18.5%, from $2.76 billion in 2015 to $6.5 billion by 2020.
GrowGen CEO Comments
Commenting on GrowGen’s purchase of Central Coast Garden and Farm Supply, Darren Lampert, Co-Founder and CEO, said, “Central Coast Garden and Farm Supply strongly positions GrowGen in the Central Coast region of CA., which is abundant with cultivators. Increasing our warehouse and retail showroom space, will allow us to stock at inventory levels and sizes to attract the large commercial growers. With over 1,000 cultivation licenses already issued, GrowGen is well positioned to service the Central Coast region. California is a major marketplace that the Company is developing and plans to add several locations in the coming months.” “Further, the company reiterates its revenue forecast for 2018 to $37M. We have a strong acquisition pipeline in development for 2018.”