Cresco Labs has agreed to acquire Columbia Care Inc. in a deal worth $2 billion, making the firm largest multi-state operator in the U.S. with a pro-forma revenue of more than $1.4 billion.
The deal, which still requires regulatory approval, gives the company more than 130 retail stores throughout 18 states – the second largest in the industry and the largest footprint outside of Florida. On a pro-forma basis, Cresco said it expects to have annual revenues in excess of $100 million in eight different states by 2023.
Charles Bachtell, CEO of Cresco Labs, said the “acquisition brings together two of the leading operators in the industry, pairing a leading footprint with proven operational, brand and competitive excellence.”
“The combination is highly complementary and provides unmatched scale, depth, diversification and long-term growth. … [and] accelerates our journey to become the leader in cannabis in a way no other potential transaction could.” – Bachtell in a press release
Nicholas Vita, CEO of Columbia Care described the deal as a “historic moment.”
“With Columbia Care’s strategic national footprint in the most attractive markets and Cresco Labs’ success in execution and incredibly popular brands, we will together create the most important – and the most investable – company in cannabis,” he said in a statement.
The transaction has been unanimously approved by the boards of directors of each of Cresco Labs and Columbia Care.
Independently, the companies currently have the top share positions in four markets – including Illinois, Pennsylvania, Colorado, and Virginia, and a number two share in Massachusetts. The companies also said they have a pathway to a top-three position in New York, New Jersey, and Florida, which bring the combined company to a material market position in seven of the top 10 markets by revenue in 2025, according to cannabis industry analytics firm BDSA’s top-10 largest and fastest-growing markets by 2025, representing approximately 55% of the U.S. population and over 70% of the addressable cannabis market.
The transaction is the second-largest in the history of the U.S. cannabis industry – behind the $2.1 billion takeover of Harvest Health and Recreation by Trulieve Cannabis Corp. in October 2021.
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