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(This is a developing story that will be updated.)
Cannabis multistate operators Cresco Labs and Columbia Care are officially walking away from their planned merger, a deal that was valued at $2 billion when it was announced in March 2022.
There are no costs associated with terminating the deal, according to a Monday news release.
“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,” Charles Bachtell, CEO and co-founder of Chicago-based Cresco Labs, said in a statement.
The deadline to close the deal had been delayed twice, most recently until June 30.
Then, on June 30, the companies announced they had not divested overlapping assets required by marijuana regulators in several states.
The terminated deal also means that the companies’ plans to sell assets in Illinois, Massachusetts and New York to rapper and business mogul Sean “Diddy” Combs have been terminated, effective July 28, according to the release.
The sale to Combs would have created the largest Black-owned marijuana multistate operator in the United States.
Earlier this year, New York-headquartered Columbia Care streamlined its operations, laying off 25% of its corporate employees and shuttering some operations.
“Over the last 16 months we have reviewed every aspect of our business, remained decisive and have made substantive changes that significantly improved our operations – positioning us with significant strategic and operational strength at this inflection point in the company’s history,” Columbia Care CEO Nicholas Vita said in a statement.
Kate Robertson can be reached at kate.robertson@mjbizdaily.com.
