The closing date for the companies’ acquisition has been “mutually agreed” to be moved from March 31 to June 30 by marijuana multistate operators Columbia Care and Cresco Laboratories. It’s the second such extension, which emphasizes the challenges of concluding a sizable transaction at a time when other acquisitions have been postponed due to extensive layoffs and limited funding in the cannabis market.
In a press release, it was said that the delay will provide Cresco and Columbia Care more time to complete the asset disposal agreements required to close the acquisition and get regulatory approvals. Both businesses must dispose of a number of assets in order for the Chicago-based Cresco Laboratories’ acquisition of Columbia Care, which was valued at about $2 billion in March, to go through.
Initial plans called for the massive deal to be completed in December 2022. It became unclear whether the merger would actually close when that date was pushed back to March. New rumors will undoubtedly be sparked by the most recent delay.
Sean ‘Diddy’ Combs, a rapper and business tycoon, will purchase a large portion of the companies’ assets and use them to launch the nation’s first Black-owned multistate cannabis operator. The combination still requires the sale of assets located in Florida, Maryland, and Ohio.
In a statement, Nicholas Vita, CEO of Columbia Care, a New York-based company, stated, “We continue to make considerable work on the remaining divestitures and look forward to making those announcements.” In the meanwhile, according to Vita, the business is “driving operational efficiency, expanding market-level scale to mitigate pricing pressure.
demonstrating leadership in several of the fastest growing markets in the sector, such as New Jersey, Virginia, and West Virginia.” 25% of Columbia Care’s corporate employees were laid off earlier this year. The fourth quarter and year-end financial results for Columbia Care will be released on March 29.
