Curaleaf Secures $500M Debt Financing at 11.5% Interest Rate

Curaleaf Holdings closed a $500 million private placement of senior secured notes this week, marking one of the largest debt financing deals in the cannabis industry this year. The notes carry an 11.5% interest rate and mature in 2029.

The Stamford, Connecticut-based multi-state operator announced the completion of the offering on Wednesday, adding significant capital to its balance sheet as the company continues expanding its national footprint. Curaleaf operates in 17 states with 151 dispensaries and 30 cultivation sites.

The Numbers Tell a Story

The 11.5% interest rate reflects the ongoing challenges cannabis companies face in accessing traditional capital markets. For context, non-cannabis companies with similar revenue profiles typically secure debt financing at rates between 5-7%. But federal prohibition means cannabis operators remain locked out of major stock exchanges and traditional banking relationships—forcing them into private placements with higher borrowing costs.

Curaleaf reported $1.4 billion in revenue for 2025, making it one of the industry's top three operators by sales. The company has been profitable on an adjusted EBITDA basis for several consecutive quarters, though GAAP profitability remains elusive due to Section 280E tax restrictions that prevent cannabis businesses from deducting normal operating expenses.

Why This Matters Now

The timing of this financing comes as cannabis companies prepare for potential federal policy shifts. Several multi-state operators have been raising capital in anticipation of either federal legalization or rescheduling, both of which would dramatically change the competitive landscape.

"Access to capital remains the number one constraint for cannabis businesses," said one industry analyst who requested anonymity because they're not authorized to speak publicly about client companies. "Even at 11.5%, this kind of institutional financing wasn't available to MSOs five years ago."

The private placement structure—rather than a public bond offering—is standard for cannabis companies. Federal prohibition means they can't list on major U.S. exchanges like the NYSE or NASDAQ. Curaleaf trades on the Toronto Stock Exchange and over-the-counter markets in the U.S.

Industry Response

Other large operators have pursued similar financing strategies recently. Trulieve raised $350 million through convertible notes last year, while Verano secured a $100 million credit facility. The pattern suggests institutional investors are becoming more comfortable with cannabis debt, even at premium rates.

The sector has seen consolidation slow considerably from its 2021-2022 peak, when MSOs were acquiring smaller operators at a rapid pace. Higher interest rates across the broader economy—combined with cannabis-specific borrowing costs—have made leveraged acquisitions less attractive.

What's Next

Curaleaf hasn't specified exactly how it plans to deploy the $500 million, though industry observers expect a mix of debt refinancing, capital improvements, and potential strategic acquisitions if valuations become more favorable.

The company's next earnings report, expected in late March, should provide more clarity on its capital allocation strategy. Investors will be watching whether Curaleaf uses the funds to expand in newer markets like New York and New Jersey, or to strengthen its position in established markets like Florida and Massachusetts.

For now, the successful close of this offering signals that institutional capital is still flowing into cannabis—just at a price that reflects the industry's unique regulatory challenges.

This article is based on original reporting by www.newcannabisventures.com.