Canopy Growth plans on acquiring Supreme Cannabis

Canopy Growth plans on acquiring Supreme Cannabis

The cannabis company continues in acquisition mode as it readies another purchase

Canopy Growth has been busy this year, already setting out to complete several key acquisitions. The cannabis company is already leading the industry in growth and its latest addition to the portfolio comes through The Supreme Cannabis Company. Canopy Growth announced today that it has signed a definitive agreement to purchase the company in a deal worth approximately $435 million.

Canopy Growth will acquire all Supreme issued and outstanding common shares and, in return, Supreme shareholders will receive 001165872 of a single Canopy Growth share, as well as $0.0001 in cash in exchange for each share held. The result is a premium to Supreme shareholders of around 66%, based on the closing prices of the shares of both companies as of the closing of the Toronto Stock Exchange yesterday afternoon.

David Klein, Canopy Growth CEO, explained in a statement, “As we continue to expand our leading brand portfolio, we’re excited to reach more consumers through Supreme’s premium brands and high-quality products, further solidifying Canopy’s market leadership. Supreme’s deep commitment to superior genetics, top-tier cultivation and strict quality control, paired with Canopy’s leading consumer insights, advanced R&D and innovation capabilities, is expected to create a powerful combination that aligns with our strategic focus to generate growth with premium quality products across key categories.”

Before the deal can be finalized, shareholders of Supreme must approve by at least a 2-to-1 margin. That vote is currently scheduled to be held in June. Canopy Growth has to receive court approval under Canada’s Competition Act and the TSX has to approve, as well. Provided everything remains on schedule, the acquisition should be finalized by the end of June.

Adds Beena Goldenberg, President and CEO of Supreme Cannabis, “This transaction is a testament to the value created by all the teams at Supreme and will be beneficial to all of our stakeholders. We have been successful at delivering great products that achieved strong customer loyalty, and operating at levels of efficiency that are industry-leading. We have also built a highly sought-after premium brand in 7ACRES. Combining Supreme Cannabis with Canopy – a Canadian market leader with exposure to the United States – presents a significant value creation opportunity for both companies. We look forward to working with Canopy to complete this transaction.”

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