Canopy Growth accelerates its entry into the U.S. market

Last week, the Canopy Growth Corporation announced its intention to accelerate its entry into the American market. The company stated that it is consolidating its American assets into a new company, Canopy USA.

Canopy's US portfolio will include the acquisition of multi-state operator Acreage Holdings, the Californian extractor Jetty Extracts and the manufacturer of’edibles Wana Brands – that Canopy had agreed to purchase once cannabis was legalized by US law. Canopy, however, decided not to wait for U.S. federal legalization.

David Klein, CEO of Canopy, stated that this strategy will allow the company to «take control» of its own destiny and «capitalize on the unique opportunity presented by the largest cannabis market in the world.»

«We anticipate unlocking the full power of Canopy within the U.S. cannabis ecosystem to unlock potential expansion opportunities. This strategy and positioning are true differentiators that we believe will allow our investors and brands to realize near-term value while positioning Canopy for profitable growth and a strong start as soon as U.S. federal legalization is achieved,» explained David Klein in a press release.

The operation could take a year and a half, the time to gather the necessary authorizations from both the US economic authorities and the various boards Companies to acquire.

Constellation Brands, the spirits giant Who put more than 4 billion into Canopy? stated he plans to transition into a more passive, non-voting role. The liquor company will retain its current stake but will no longer be permitted to appoint representatives to Canopy's board or approve certain transactions. It will also no longer have the right to review Canopy's financial results.

«This transaction and the relinquishment of our warrants should eliminate the impact on our earnings per share, mitigate risk for our organization, and reinforce our intention not to deploy any further capital into Canopy, consistent with Constellation's previously stated capital allocation priorities,» said Bill Newlands, President and Chief Executive Officer of Constellation.

Collectively, Canopy's footprint currently spans 21 U.S. states, including Arizona, Arkansas, California, Colorado, Connecticut, Florida, Illinois, Maine, Maryland, Massachusetts, Michigan, Missouri, Nevada, New Hampshire, New Jersey, New Mexico, New York, Pennsylvania, Ohio, Oklahoma, and Oregon.