Cresco Labs and Cultivator Columbia Care End Plans for Merger
The merger, 16 months in the planning process, has been called off in a mutual agreement between the two companies.
At the end of July 2023, multistate cannabis companies Cresco Labs and Columbia Care announced that there would be no $2 billion merger, which had been first announced in March of 2022 (1). The merger was originally predicted to be one of the largest in the industry (2). Finalizations of the agreement were delayed once in March 2023 and again in June 2023 before being called off completely (3).
“In light of the evolving landscape in the cannabis industry, we believe the decision to terminate the planned transaction is in the long-term interest of Cresco Labs and our shareholders,” Cresco Labs CEO Charles Bachtell said in a press release (1).
In November of 2022, the companies also announced that nine dispensaries and three production facilities in three different states would be sold to entrepreneur and hip-hop mogul Sean “Diddy” Combs in order to fulfill state requirements that certain assets must be sold before the merger could continue (4). That agreement, said to be worth $185 million, has also been terminated (1). It would have created “the first minority-owned and operated, vertically integrated multistate operator,” according to both companies (4).
Cresco Labs and Columbia Care published the same press release on their websites concerning the terminated merger (1). A press release from Columbia Care dated July 31, 2023, also explained the company’s recent accomplishments and plans to move forward (5).
“With the uncertainty of the past 16 months behind us, along with the enthusiasm and energy that accompanies moments of renewal, our team welcomes the next stage of Columbia Care’s growth and expansion,” Nicholas Vita, CEO of Columbia Care said in the press release (5). “In spite of the challenges we have faced, the team has remained committed to the success of our Company and, as is obvious from the pace of activity, has been engaged at all levels, actively preparing for the future.”
Columbia Care is based in New York and Cresco Labs is headquartered in Chicago (3).
References
- Lange, T. https://www.cannabisbusinesstimes.com/news/no-deal-cresco-labs-columbia-care-acqusition/ (accessed Jul 31, 2023).
- Smith, J. Cresco’s marijuana asset sales could hit $500 million after Columbia Care Deal, analysts say https://mjbizdaily.com/cresco-labs-marijuana-asset-sales-could-total-500-million-after-columbia-care-deal/?utm_medium=email&utm_source=newsletter&utm_campaign=MJD_20220329_NEWS_Daily (accessed Jul 31, 2023).
- Marijuana Megamerger between Cresco, Columbia care still up in the Air https://mjbizdaily.com/marijuana-megamerger-between-cresco-columbia-care-still-up-in-air/?utm_medium=email&utm_source=newsletter&utm_campaign=MJD_20230703_NEWS_Daily (accessed Jul 31, 2023).
- Simakis, M. Cresco Labs and Columbia Care on Sean “diddy” combs deal: ’we didn’t ... https://www.cannabisbusinesstimes.com/news/sean-diddy-combs-cannabis-cresco-columbia-care/ (accessed Jul 31, 2023).
- Columbia Care announces corporate actions to accelerate operational efficiencies and cash flow generation https://ir.col-care.com/news-releases/news-release-details/columbia-care-announces-corporate-actions-accelerate-operational (accessed Jul 31, 2023).
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