Sean “Diddy” Combs is working to create America's first Black-owned multistate cannabis company with a new bid to buy assets from two existing weed businesses.
The rapper and business mogul just announced plans to buy a dozen cannabis retail and production facilities owned by Columbia Care and Cresco Labs, two of the country's largest multistate cannabis operators. The deal is part of a larger transaction in which Chicago-based Cresco is working to acquire New York-based Columbia Care. The two companies will need to sell off some of their assets to complete the merger, and Diddy has agreed to step in to buy up some of these businesses.
In exchange for a cool $185 million, Combs will take ownership of two Columbia Care dispensaries and one production facility in Chicago, plus several more dispensaries and another production location in Massachusetts. Diddy would also acquire several of Columbia Care's New York locations, including New York City and Rochester dispensaries and a third production facility. This acquisition would create “the country’s first minority-owned and operated, vertically integrated multistate operator,” according to Cresco.
Diddy's purchase of these assets is contingent on the merger between Cresco and Columbia Care, which has yet to be approved by federal regulators. But if the feds greenlight the transaction, purchasing the companies' assets will take place in March 2023. Dozens of other Black celebrities, including fellow rappers Jay-Z and Ice-T, have launched their own weed companies, brands, and partnerships. Still, the Cresco deal would reportedly make Diddy the first Black investor to run multistate weed operations.
Combs told the press that he hopes this transaction will help address the rampant inequalities in the US cannabis industry. Over 81% of American weed businesses are white-owned, according to one recent report. And according to a report by MJBizDaily, the percentage of racial minorities who are cannabis industry executives has fallen from 13% in 2021 to 12% this year.
“It’s diabolical,” Combs told the Wall Street Journal. “How do you lock up communities of people, break down their family structure, their futures, and then legalize it and make sure that those same people don’t get a chance to benefit or resurrect their lives from it?”
"My mission has always been to create opportunities for Black entrepreneurs in industries where we've traditionally been denied access, and this acquisition provides the immediate scale and impact needed to create a more equitable future in cannabis," Combs said in a statement. "Owning the entire process - from growing and manufacturing to marketing, retail, and wholesale distribution - is a historic win for the culture that will allow us to empower diverse leaders throughout the ecosystem and be bold advocates for inclusion."
“We’ve seen executive power exercised to address matters of cannabis injustice, we’re seeing bi-partisan support for elements of federal reform, and we’re seeing some of the largest and most influential states in the country launch cannabis programs prioritizing social responsibility– this announcement adds to that momentum,” said Cresco CEO Charlie Bachtell in a press release.