Canopy Growth
Tom Franck | CNBC
Canadian cannabis company Canopy Growth mentioned Tuesday it is consolidating its U.S. belongings into a new holding company to speed up its entry into the U.S. market.
The company mentioned the creation of Canopy USA will assist it scale back prices and faucet into the U.S. market, which is projected to be greater than $50 billion by 2026. Marijuana will not be but federally authorized within the U.S.
“As the growth of the U.S. cannabis market continues rapidly at the state level, this strategy enables us to take control of our own destiny and capitalize on the once-in-a-generation opportunity in the largest cannabis market in the world,” mentioned David Klein, CEO of Canopy Growth Corp.
Canopy mentioned the transfer will enable it to full its acquisition of New York-based Acreage Holdings, Colorado-based edibles specialist Wana Brands and California extracts maker Jetty. Those belongings shall be housed underneath Canopy USA.
Canopy’s shares had been up 20% Tuesday morning.
Spirits big Constellation Brands, which acquired a stake in Canopy Growth in 2017 for $190 million, mentioned it should convert its current widespread shares in Canopy into new exchangeable shares, which it mentioned will shield shareholder worth whereas retaining its curiosity in Canopy by means of non-voting and non-participating shares.
Constellation mentioned in a statement that the transition is aligned with its choice to concentrate on its core beer, wine and spirits companies.
“We believe that the conversion of our ownership interest will maintain Constellation’s ability to realize the potential upside of our investment in Canopy,” mentioned Constellation’s CEO and President Bill Newlands.
