By Mike Wilson
Special to the Kincardine Independent
A local cannabis producer is being bought out by cannabis giant Canopy Growth.
Supreme Cannabis, owner of Tiverton-based producer 7ACRES, announced the deal via press release.
The transaction is valued at approximately $435 million on a fully diluted basis. Under the terms, Supreme Cannabis shareholders will receive 0.01165872 of a Canopy common share, and $0.0001 in cash in exchange for each Supreme Cannabis share held.
“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,” said David Klein, chief executive officer of Canopy in the release.
“Supreme’s deep commitment to superior genetics, top-tier cultivation and strict quality control, paired with Canopy’s leading consumer insights, advanced R&D (research and development) 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.”
Beena Goldenberg, president and CEO of Supreme Cannabis, said in the press release that the sale will be beneficial to all of their stakeholders.
“This transaction is a testament to the value created by all the teams at Supreme and will be beneficial to all of our stakeholders,” said Goldenberg.
“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.”
The deal is expected to close in June 2021.
The purchase of Supreme Cannabis by Canopy comes about a week after Supreme purchased the owners of Ace Valley, an Ontario-based white-label maker of pre-rolled joints, vapes and edibles.
In an interview with Yahoo! Finance, Klein stated the two deals are “tuck-in” acquisitions aimed at shoring up Canopy’s cannabis offerings in Canada ahead of more investment in the United States.
Klein said he expects the 7ACRES facility to remain a long-term part of the company’s operations.