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Agreement reached for landmark Columbia Care deal

Columbia Care is to be acquired by Cresco Labs in a deal which will create the world’s “largest cannabis company by revenue”.

Cresco has entered into a definitive agreement to acquire Columbia, which operates in 18 jurisdictions across the US, as well as in the EU.

With investors receiving 0.5579 of a subordinate voting share in Cresco for each share, the deal is valued at around US$2bn (based on share price at the time of writing).

The transaction is likely to complete in the fourth quarter of this year, subject to regulatory approvals and closing conditions.

Columbia is one of the largest cultivators, manufacturers and providers of cannabis products and related services in the US, with 131 facilities including 99 dispensaries and 32 existing and in-development cultivation and manufacturing facilities. It also has a European presence, and last year launched a medical cannabis capsule in the UK.

It is one of the original multi-state providers of medical cannabis in the US and now delivers products and services to both the medical and adult-use markets.

In 2021, it launched retail brand Cannabist, creating a US-wide dispensary network that leverages proprietary technology platforms.

Cresco is the largest wholesaler of branded cannabis products in the US.

The acquisition of Columbia will give it the “largest pro-forma revenue in cannabis today” at over $1.4bn, the company said.

CEO Charles Bachtell said: “We are incredibly excited to announce this transformative transaction today at a very important time in the development of this industry. This 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. On a pro-forma basis, the combined company will be the largest cannabis company by revenue, the number one wholesaler of branded cannabis products, and the largest nationwide retail footprint outside of Florida.

“The combination of Cresco Labs and Columbia Care accelerates our journey to become the leader in cannabis in a way no other potential transaction could.”

Nicholas Vita, CEO of Columbia Care, said: “Since our founding, our mission has been to deliver the best outcome for our stakeholders. In an evolving industry, the opportunities to better achieve our mission through consolidation led us to this 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.”

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