Marijuana

Chicago's Cresco Labs to buy Canadian pot company Origin House for $1.1 billion

Key Points
  • Canadian cannabis branding company Origin House agreed to be acquired by U.S. company Cresco Labs for about $1.1 billion.
  • The companies say the resulting combined entity will be one of the largest, vertically integrated multistate operators south of the border.
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Canadian cannabis branding company Origin House has entered into an agreement to be acquired by U.S. company Cresco Labs for approximately $1.1 billion.

As part of the all-stock deal, Origin House common shareholders will receive 0.8428 subordinate voting shares of Cresco, a cannabis cultivator, processor and retailer headquartered in Chicago, for each share of the Ottawa-based pot firm.

The two companies say in a joint release that the deal amounts to approximately $1.1 billion on a fully-diluted basis, or $12.68 per Origin House share based on Cresco's closing price on March 29.

Origin House, previously known as CannaRoyalty, has a portfolio of more than 50 brands in its portfolio including Chong's Choice and Cheech's Favourite Stash by cannabis comic Tommy Chong.

Origin House's brands and 130 branded products are distributed to more than 500 dispensaries across California, where recreational cannabis is legal and a key market for U.S. operators.

The companies say the resulting combined entity will be one of the largest, vertically integrated multi-state operators south of the border.

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Health and Science

Cannabis retailer MedMen's financial troubles are a warning for the marijuana industry

Alex Berenson, special to cnbc.com
Key Points
  • MedMen, the best-known cannabis retailer in the United States, is racing to raise cash to cover its mounting losses.
  • Its struggles show the challenge cannabis companies face in operating in states where high taxes and dispensary restrictions have driven up prices for legal marijuana.
  • In California, MedMen's core market, highly regulated companies are struggling to compete for customers with illicit dealers who charge far less.