Columbia Care climbs on $2 bln Cresco Labs deal

Cresco Labs

23/03/2022 14:22

** Shares of cannabis producer Columbia Care Inc  CCHW.NLB 
gain 3.8% to C$4.09 after rival Cresco Labs Inc  CL.CD  says it
will buy CCHW in a $2 bln deal to create the largest U.S. pot
company by sales  urn:newsml:reuters.com:*:nL3N2VQ2DD
    ** CL down 4.3% at C$7.85
    ** All-stock deal worth C$4.57/shr represents premium of
~16% to CCHW's closing price on Tuesday
    ** Deal confirms Reuters exclusive from Tuesday  urn:newsml:reuters.com:*:nL3N2VP3SH
    ** CL says it could divest assets in New York, Illinois,
Ohio, Massachusetts, and Florida to comply with regulators and
finance the deal
    ** Brokerage Jefferies says combined co will have a much
better margin profile as it brings together CL's scale with
CCHW's presence in key states missing from CL's portfolio
    ** Separately, CL posts Q4 revenue that misses analysts'
average estimate and says growth will likely be relatively muted
in H1
    ** CL stock was down ~2% YTD through last close; CCHW up ~9%

 (Reporting by Ruhi Soni in Bengaluru;)
 ((Ruhi.Soni@thomsonreuters.com;
Twitter: https://twitter.com/ruhithere;))