Vireo Growth and Glass House Brands announced Monday that they are forming a joint venture that would combine their California dispensary operations into a single retail platform spanning 23 locations, a move the companies say would create one of the largest marijuana retail networks in the state.

Under the agreement, each company would contribute its California retail operations in exchange for a 50% stake in the new entity, subject to regulatory approval and other closing conditions. Vireo said it currently operates 12 dispensaries and home delivery operations in California through assets it recently acquired from Eaze, while Glass House runs 11 retail locations in the state.

The companies say the combined platform would be backed by a preferential supply agreement with Glass House, which they describe as California’s most efficient large-scale marijuana producer. The deal is also structured with a future buyout mechanism: after five years, Vireo would have the option to acquire Glass House’s interest in the joint venture, while Glass House would have a reciprocal right to sell its share.

Cory Azzalino, Vireo’s president of California, has been named CEO of the joint venture. He would oversee operations and help lead expansion efforts, including additional retail acquisitions.

In a statement, Glass House Co-Founder and CEO Kyle Kazan said the partnership would allow the companies to better respond to California’s difficult pricing conditions by combining Vireo’s retail and delivery infrastructure with Glass House’s production scale and brand portfolio. Vireo CEO John Mazarakis said the joint venture would create a stronger and better-capitalized platform positioned to serve more consumers and support independent brands.

The companies also said the Eaze delivery platform would help extend service into parts of California with limited retail access, with the broader goal of improving access to lower-cost marijuana products through the legal market.