Cresco Labs , a big wave in the sea of consolidation sweeping through the cannabis industry.
The team evaluated multiple options, and the Cresco acquisition was the deal that was most ready to generate returns for shareholders and new opportunities for employees, according to Vita.
In 2023, the company will have eight states contributing in excess of $100 million to combined P&L, according to Bachtell.
The acquisition will also afford the companies the opportunity to streamline operations and the costs associated with building such a high-growth platform in the cannabis business.
Cresco and Columbia Care will be going through an exhaustive organizational design process, which involves rethinking best practices, KPIs and P&L responsibility.
Cresco and Columbia Care will need to divest a number of assets in order to comply with state regulatory requirements.
The company will be able to redeploy that capital for CapEx projects and for investment in capabilities, like marketing and R&D, for continued growth.
The combined company has operations in three states in the northeast on the cusp of legalizing for adult use, including New Jersey, New York and Virginia.
As a part of the combination process, Cresco and Columbia Care will need to decide how to approach retail and brands.
Once the Project Jet deal closes, the company will be able to focus more on optimization within its footprint, driven by the benefit of a new set of best practices.
Together, Cresco and Columbia Care will have a leading position in retail distribution and a unique set of KPIs to optimize cultivation and manufacturing operations, according to Vita.