The struggling Michigan market evaporated profits for Canada’s TerrAscend Corp., one of the world’s largest marijuana companies.
The publicly-traded company recorded a $332.5 million loss in 2022, largely due to $311.1 million in impairment charges tied to its acquisitions of Ferndale-based Gage Cannabis and Morenci-based Pinnacle Emporium.
Both Gage and Pinnacle were unprofitable last year, resulting in an annual cash bleed of $26.2 million, TerrAscend reported in its annual financial statement filed Friday with the U.S. Securities and Exchange Commission.
TerrAscend said it effectively overpaid for both Gage and Pinnacle as the value in the Michigan market plummeted due to product oversupply and increased competition.
TerrAscend acquired Gage in March 2022 in a deal valued at the time at $322 million and Pinnacle’s five dispensaries and an additional retail license for $31 million in August 2022.
Today, TerrAscend believes those assets are worth just $61.1 million, or $292 million below what it paid for the two companies last year.
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