While he first gained prominence as a rapper, Sean “Diddy” Combs is no stranger to the business world. He’s consolidated a number of investments under his Combs Enterprises brand, boasting ventures in fashion, wine and spirits, alkaline water, marketing, advertising and even film and TV content.
The next step? Naturally, Combs is moving forward into the cannabis space, announcing last week that he agreed to purchase a number of production outlets in the Chicago area, New York and Massachusetts, according to a
.The deal is worth at least $155 million, with Combs purchasing assets from
, obtained following its acquisition of competitor Columbia Care. Combs and company officials said that the sale will help to diversify licensed weed businesses, especially as officials in Illinois and other states face pressure to approve more cannabis licenses for minority-owned cannabis businesses.“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.
The Combs deal could set up the rapper and producer as one of the most dominant Black players in the U.S. cannabis industry. If U.S. and state regulators approve the deal, it could create the nation’s largest Black-owned and licensed cannabis company. Cresco also said that the sale makes Combs the United States’ first Black investor in cannabis with multistate operations. Combs would put this power to good use, too: He wants to use the business as a platform to invite more Black professionals to participate in the industry.
“It’s diabolical,” Combs told
, referencing the lack of minority representation in cannabis. “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?”The Combs Deal is Groundbreaking
According to the release, the asset sale allows Combs to cultivate and manufacture cannabis products; distribute those products to licensed retailers in metropolitan areas, like Boston, Chicago and New York City. It can operate retail stores in those three states as well.
ATB Financial is acting as the financial advisor to Columbia Care on the divestiture process, and on behalf of Combs Enterprises; the transaction is expected to close at the end of the first quarter of 2023.
Curtis Stange, president and CEO of ATB Financial, said the institution was pleased to be an advisor in this “milestone transaction,” adding that it “represents a pivotal moment for minority entrepreneurs as well as for this industry.”
“Our highly specialized team of experts at ATB Capital Markets helps companies find success locally and globally with expert advice and access to capital,” Stange added.
Cresco Labs CEO Charles Bachtell also said that the transaction is a “major step” toward closing the
.“For an industry in need of greater diversity of leadership and perspective, the substantial presence of a minority-owned operator in some of the most influential markets in the country being led by one of the most prolific and impactful entrepreneurs of our time is momentous… and incredibly exciting,” Bachtell said. “We’re thrilled to welcome Sean and his team to the industry.”
According to MJBizDaily’s
, “Diversity, Equity & Inclusion in the Cannabis Industry,” 12.1 percent of cannabis industry executives in the U.S. are racial minorities, a slight dip from 2021’s 13.1 percent. That number is below the average for all U.S. businesses: The Bureau of Labor Statistics estimated in 2021 that 20.1 percent of all U.S. CEOs were racial minorities, MJBizDaily .“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,” Combs said.