Chicago Atlantic Companies Merge to Boost Cannabis Lending

Chicago Atlantic Real Estate Finance, Inc. (REFI) and Chicago Atlantic BDC, Inc. (LIEN) have agreed to combine into one public entity. The deal will see REFI switch its status from a real‑estate investment trust to a business development company and merge with LIEN in an all‑stock swap. After closing, LIEN will keep the ticker “LIEN” and continue as a BDC. Both boards approved the merger unanimously, after independent committees reviewed the terms. REFI shareholders will receive LIEN shares at a ratio based on each company’s net asset value (NAV) just before the deal finishes. With NAVs from March 31, 2026, REFI holders are expected to own about half of the new company. The combined firm will target a pro‑forma NAV near $613 million and an investment portfolio of roughly $771 million. This larger scale is intended to broaden the borrower base, diversify loan types—cash‑flow, real‑estate‑backed and direct lending—and improve access to cheaper debt. Management believes the merger will create cost savings, better liquidity for investors, and higher earnings through smarter use of leverage.Peter Sack, who runs both companies, said the move will unlock value in the growing cannabis market and accelerate growth for LIEN. Executive Chairman Scott Gordon added that the deal should enhance shareholder value, support earnings over time, and maintain strong credit quality. The merger still needs stockholder votes, regulatory approval, and other customary conditions. If all goes well, closing is expected in Q4 2026. REFI will pay $2 million toward transaction costs. Key advisors include Oppenheimer and Keefe, Bruyette & Woods. A joint conference call will be held on June 18 at 9:00 a. m. ET, with a webcast available online. Both companies focus on lending to cannabis operators and other niche businesses. Investors can find detailed information in the upcoming SEC filings, including proxy statements and prospectuses.