Cannabis sale timeline: LOI to close

The timeline at a glance

Stage	Typical duration	Ends when
1. LOI signed; exclusivity begins	Day 0
2. Due diligence	30 to 60 days	Buyer confirms or reprices
3. Purchase agreement negotiated and signed	30 to 45 days, overlapping diligence	Deposit goes into escrow
4. Application assembled and filed	2 to 6 weeks	Regulator accepts it as complete
5. State review	1 to 9 months or more, by state	Written approval
6. Local approval, landlord consent, tax clearance	Runs alongside stage 5; can outlast it	All conditions satisfied
7. Closing and handover	1 to 3 weeks after the last approval	Funds released, control passes

Stage durations other than the published regulator clocks below are general practice, not statistics. This page starts at the LOI. The earlier phases, preparation and marketing, are covered on how long does it take to sell a cannabis business.

Stage 1: the LOI sets the calendar

A good LOI fixes the dates everything else hangs on: the exclusivity period, the diligence deadline, a target signing date, who files what with the regulator, and a proposed outside date. Exclusivity should run to the signing of the purchase agreement, since the approval period is then governed by that agreement. Terms are covered in the letter of intent guide.

Check two dates on day one: the license renewal date and the lease expiry or option date. Either can land in the middle of the review period.

Stage 2: due diligence, 30 to 60 days

Diligence runs on three tracks at once: financial, including reconciling reported sales to state tracking data; regulatory, meaning the license file and compliance history; and legal, covering the lease, contracts, liens and taxes. The work list is on the cannabis due diligence checklist.

Use this period to start the items with long lead times:

• Buyer owners begin fingerprints and personal disclosures.
• Seller requests state tax clearance. In California the CDTFA has 60 days to issue a certificate or state the amount due.
• Both sides open the conversation with the landlord.
• Buyer identifies an escrow agent willing to hold cannabis-related funds.

Stage 3: purchase agreement, 30 to 45 days

Drafting usually begins midway through diligence. The points that take longest in cannabis deals are the regulatory-approval contingency, the indemnity package, and security for any seller note. Regulators read this document. Illinois guidance expects the agreement to state that the sale is contingent on department approval and to give the expected closing date.

Stages 4 and 5: how long does state approval take?

Few regulators commit to a number. These are the clocks and queue markers that are actually published:

State	Published rule or status	Source
Missouri	Decision within 150 days for a change of 50% or more; 90 days where a new individual becomes an owner; 60 days for transfer to a different entity with the same ownership	19 CSR 100-1.100
Florida	Application due at least 60 days before the change; department decision within 30 days of a complete application	Fla. Stat. 381.986
Oregon	No fixed clock; OLCC posts the submission date it is currently assigning. On 21 August 2026 it was assigning change applications filed 19 August 2026	OLCC licensing page
Colorado	State issues contingent approval, valid for one year, pending local approval	1 CCR 212-3, Rule 2-245
California	If at least one owner remains, new owners file within 14 calendar days of the change and operations continue; if all owners change, no operation under new ownership until a new license is approved	4 CCR 15023
Oklahoma	$2,500 transfer application fee plus tier fee; pending renewals are processed before transfers; 15 business days after approval to transfer product in Metrc	OMMA
New Jersey	No published review clock; no more than 50% of ownership may transfer from application until two years after operations begin	N.J.A.C. 17:30-9.3

Where nothing is published, the only guide is practitioner experience. One M&A attorney’s April 2026 state-by-state summary reports ranges from 90 to 120 days in Michigan for previously vetted owners to 6 to 12 months for full ownership changes in California; the full table is on the how long does it take to sell page. What regulators examine and charge is on change of ownership approval explained.

Three things move a deal from the slow end of a range to the fast end:

1. A buyer the state already knows. Existing licensees in good standing skip much of the background work.
2. A complete first filing. Every owner, every funding source, every related agreement.
3. A frozen ownership chart. Adding or swapping an investor after filing often restarts review.

Stage 6: the parallel tracks

These do not wait for the state and should not be made to.

Track	Start	Typical hazard
Local permit or ownership approval	At signing, or earlier informally	Hearing calendars, notice periods, council recesses. See local control and municipal approvals
Landlord consent and estoppel	During diligence	Consent traded for a rent increase. See landlord consent and cannabis lease clauses
Tax clearance	During diligence	Open audits; agency response time
Buyer banking	At signing	New-owner onboarding can take weeks. See opening a bank account after acquisition
Staff badges	30 to 60 days before expected approval	State-specific credential rules. See employee transfer and agent badges
Insurance	30 days before closing	Policies must bind at the effective time

During this stretch the seller runs the business under ordinary-course covenants. If the buyer needs a hands-on role, it must fit within a disclosed interim management services agreement.

Stage 7: closing, 1 to 3 weeks after approval

Approval letters seldom arrive on a convenient day. Agreements usually set closing a fixed number of business days after the last condition is met, which gives time for the inventory count, final lien searches, the funds-flow memo and system handover. Oklahoma’s rule shows why sequencing matters: the buyer has 15 business days after approval to transfer product in Metrc. The day itself is described on closing on a cannabis business.

Illustrative calendar: Missouri dispensary, 100% equity sale

Week	Event
0	LOI signed; 60-day exclusivity
1 to 6	Diligence; buyer owners fingerprinted; landlord approached; tax clearance requested
4 to 9	Purchase agreement drafted
9	Agreement signed; deposit to escrow
9 to 12	Application assembled and filed
12 to 33	State review, up to 150 days; one information request answered in week 18
20	Landlord consent and estoppel signed
33	Approval letter
35	Inventory count, closing, handover

Total: about eight months. With an outside date set at week 40 and an automatic extension, the parties have margin without reopening the deal.

What this means for buyers and sellers

Buyers. Your financing has to stay committed for the whole period. Private lenders and investors issue commitments with expiry dates, so match them to the outside date, not the hoped-for date. If part of the deal can lawfully close early, see staged closings and escrow pending approval.

Sellers. You run the business, renew the license and carry the compliance risk until closing, possibly for most of a year after you have mentally moved on. Price, inventory and working capital are measured at closing. A buyer with an existing license in your state is often worth more than a slightly higher offer from a newcomer, because of what it does to this timeline.

This page is general education, not legal advice, and no timeline is guaranteed; regulators control their own calendars.