Diddy has reportedly lost out on his bid to create the largest Black owned-cannabis company in the world due to Cresco Labs Inc. and Columbia Care Inc. abandoning their key merger.
The Bad Boy Records boss announced last November that he’d be investing $185 million into cannabis operations helmed by Cresco Labs Inc. and Columbia Care Inc. — who were planning a massive merger — in order to obtain nine Black-operated retail stores across New York, Massachusetts and Illinois.
However, according to variousreports, the deal was terminated on July 28 due to Cresco Labs and Columbia Care aborting their merger.
The two companies are valued at $1 billion and $500 million, respectively, and buy-in into their enterprises included a $110 million cash payment and an additional $45 million in debt financing, Last November, Diddy said such a price tag didn’t matter when it came to creating opportunities for the Black community.
“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,” he 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.”
Despite the cancelation of this historic deal, Cresco and Columbia Care reportedly said they “intend to focus on enhancing their competitiveness and driving efficiencies, positioning themselves for potential growth opportunities in the evolving cannabis industry landscape.”
The failed deal is the latest blow to Diddy, who is currently embroiled in a tense legal dispute with spirits company Diageo.
As reported by The Wall Street Journal, Puff accused Diageo of racial discrimination and alleged in his filing that the company marketed their DeLeón brand as an “urban” and “Black” tequila brand.
Diageo retaliated at the end of June by cutting ties with Diddy entirely, calling the lawsuit a “sham.” The company further accused the Bad Boy mogul of only contributing $1,000 cash to their partnership despite raking in over a billion in profits.
On July 20, Diddy condemned Diageo’s move via a new filing and urged the court to move forward with the suit.
“The message is clear — if you dare to shed light on Diageo’s conduct, you will be punished,” Diddy’s lawyer John Hueston said in documents filed in New York State Supreme Court. “While Diageo has self-servingly misrepresented the goals of Combs’s lawsuit in the press, its attempt to retaliate against Combs for asserting his legal rights will not work in court.”