Ayr Wellness Sells Assets in Foreclosure, Restructures Amid Debt Crisis

Ayr Wellness, a prominent multistate operator in the cannabis industry, has transferred ownership of its assets to former creditors following a foreclosure auction. This move comes as part of a broader restructuring plan initiated due to significant financial challenges, including a substantial debt burden. The company's senior note holders acquired assets and equity interests in seven states, marking a significant shift in the company's operational landscape

While specific terms of the sale, such as the purchase price, were not disclosed, it is known that the senior note holders had $387 million in credit available for the acquisition. The completion of this transaction is contingent upon regulatory approval for the transfer of Ayr's licenses. This development signifies a critical step in the planned dissolution of Ayr's current corporate structure, as outlined in a recent company statement

Interim CEO Scott Davido has confirmed that Ayr Wellness will maintain operations in certain states during the transition to a new corporate entity. Despite the company's recent struggles, including a dramatic drop in share value from over $35 at its peak to below $0.02, Davido remains optimistic about the restructuring. The new strategy aims to reduce Ayr's debt by 50% and focus investment efforts on Virginia, where the company holds a valuable vertically integrated medical marijuana permit

The restructuring plan also includes a future focus on Virginia's cannabis market, where adult-use sales are anticipated to commence next year. Ayr Wellness's strategic shift is intended to capitalize on this opportunity, leveraging its existing permit to establish a foothold in the emerging market. As the company navigates these changes, it remains to be seen how effectively it can rebuild and reposition itself within the competitive cannabis landscape