A byline by Arnau Valdovinos
Despite a global surge in cannabis M&A in 2024, Germany’s consolidation has yet to materialise as firms focus on organic growth. The post-legalisation boom has driven soaring demand, leading companies to invest in infrastructure and market positioning. Unlike Canada and Australia, German operators are taking a wait-and-see approach, ensuring top-line growth before engaging in M&A. As the market matures, a wave of consolidation is expected, positioning well-prepared firms at the forefront of Europe’s cannabis industry.
The global cannabis industry witnessed unprecedented merger and acquisition activity in the second half of 2024, with major deals reshaping markets from Canada to Australia. However, despite Germany’s emergence as Europe’s cannabis powerhouse following its April 2024 legalisation, M&A activity in the country has remained surprisingly subdued. This apparent paradox – limited consolidation in Europe’s largest cannabis market – offers insights into the strategic priorities of German operators and their long-term market positioning.
A Market in Transition: Global Cannabis Consolidation Gains Momentum
In Canada, the industry’s most mature market outside the USA, 2024 saw transformative deals including Organigram Inc’s C$90 million acquisition of Motif Labs, creating the market’s largest player by share. International operators demonstrated strong interest in Canadian production assets, like Curaleaf acquiring EU-GMP producer Northern Green Canada, or the UK’s Cannaray merging with Aqualitas in a move to strengthen their global supply chains. Moreover, opportunistic acquisitions of distressed assets mounted, such as Indiva’s acquisition by SNDL for C$22.7 million.
Australia similarly experienced significant consolidation, highlighted by Phytoca’s A$62 million acquisition – marking the largest Chinese entry into global cannabis. The market saw numerous strategic consolidation moves, from Vitura Health and Crisci Group’s acquisition of Releaf’s clinics to Aurora Cannabis completing its MedReleaf Australia buyout.
In Europe, consolidation was evident outside Germany as well. Portugal’s SOMAÍ Pharmaceuticals secured cultivation capacity by acquiring RPK Biopharma, while Curaleaf expanded into Poland through its Can4Med acquisition. Meanwhile, in the UK, the fast-growing medical cannabis clinics sector saw the merger of Cellen’s Leva Clinic with Khiron’s Zerenia Clinic.
Post-Legalisation Boom: Why German Operators Are Prioritising Organic Growth
Unlike their counterparts in Canada, Australia, and other European markets, German cannabis operators have taken a markedly different approach. While some M&A activity has taken place—such as SynBiotic’s acquisition of WEECO for €12 million, Promamec’s 51% acquisition of HERBLIZ Berlin, and High Tide entering the market with a 51% stake in Purecan for €4.8 million—the widespread consolidation many had anticipated has yet to unfold. However, this restraint appears to be a deliberate strategic decision rather than a missed opportunity.
The post-legalisation environment has sparked an unprecedented demand surge, prompting companies to prioritise organic growth and operational execution over acquisitions. The volume of imported medical cannabis soared from 8 tonnes in Q1 2024 to over 20 tonnes in Q3, reflecting an accelerating market. Rather than engaging in M&A deals, German firms are investing in infrastructure, market positioning, and brand recognition to establish dominance in the newly legal market.
This strategy is paying off. Cantourage reported full-year 2024 sales of €51.4 million, surpassing its raised forecast with 118% year-over-year growth, with an annual run-rate in December of over €100 million in sales. WEECO Pharma, following its acquisition by SynBiotic, projects revenues to exceed €8 million for the full year, prompting upward revisions for 2025 and 2026 forecasts. Grünhorn, which has invested over €35 million since 2020, forecasts over €60 million in annual sales in the coming years. Enua tripled its revenue from €7 to €20 million in 2024. According to a recent Bloomwell report, December 2024 saw a more than 1,000% increase in prescriptions compared to March in its pharmacy network, indicating dramatic expansion in medical cannabis adoption.
With soaring sales across the entire supply chain, German operators see a compelling case for delaying large-scale M&A. Rather than rushing into acquisitions that may not yet realise the value of a growing market, companies are focusing on organic growth by expanding processing and distribution capabilities, securing robust international supply chains and reinforcing their presence in the telemedicine and pharmacy sectors, which remain key pillars of the German market.
Given the volatility of global cannabis valuations and the pricing uncertainties typical of early-stage markets, this wait-and-see approach appears well-founded. By postponing acquisitions, German companies are positioning themselves to negotiate better terms in the months ahead as valuations stabilise and clearer market leaders emerge.
Looking Ahead: The Coming Wave of German Cannabis M&A
While the German market’s focus on organic growth has postponed consolidation, this pause should not be mistaken for a permanent trend. Several factors suggest a significant wave of M&A activity is likely in the near future. As the market matures, clearer differentiation between operators will emerge, making acquisition targets more identifiable. Companies that establish strong operational track records will also benefit from more reliable valuations, ensuring that M&A transactions reflect actual market strength rather than speculative growth.
At the same time, regulatory frameworks will continue to evolve, providing greater clarity for investors and improving the overall investment landscape. If capital market conditions strengthen, financing for acquisitions will become more accessible, allowing well-positioned companies to execute strategic takeovers at more favourable terms. As a result, German cannabis firms that have focused on execution, market expansion, and financial discipline will be in prime positions—either as acquirers or as attractive acquisition targets.
Germany’s measured approach to M&A reflects a cannabis market learning from global precedents while charting its own path. Although consolidation has progressed more slowly than initially expected, this strategic patience could ultimately result in stronger, more sustainable, and higher-value transactions when the next phase of industry development begins.
By prioritising organic growth, German operators are ensuring they remain financially strong, well-positioned, and acquisition-ready when the inevitable wave of M&A finally arrives. And when it does, those who waited for the right moment may find themselves at the forefront of Europe’s next major cannabis consolidation boom.
About the Author
As the founder and principal consultant of Cannamonitor, Arnau Valdovinos (Linkedin) connects the dots of the global supply chain through an independent view of the international cannabis markets. An advocate for evidence-based drug policy reform, since 2018 Arnau has provided intelligence and practical advice to medicinal, recreational and CBD companies across 5 continents and 20 countries.
Disclaimer: Guest contributions do not have to reflect the opinion of the editorial team.