Canopy Growth on Thursday unveiled a multimillion-dollar plan to enter the Latin America medical cannabis market.
The Smiths Falls, Ontario-based firm has launched a new subsidiary, Canopy LATAM Corp., which acquired Spectrum Cannabis Colombia S.A.S for $34.8 million (CA$4.6 million) in Canopy stock.
The deal has built-in performance milestones that, if met, would give the former shareholders of Spectrum an additional $61.2 million in shares, according to a news release.
Canopy LATAM’s initial operations will be headquartered in Huila, Colombia, where the firm owns a 300-acre-plus farm of which more than 100 acres are licensed to produce cannabis. Operations there will serve as the firm’s regional production and processing hub, the company said.
The new subsidiary will be led by Antonio Droghetti, who has been given the title regional managing director. A former CEO of health-care device firm Lifemed, Droghetti will be charged with leading Canopy LATAM’s efforts to expand to markets across South and Central America.
In other news, Canopy Growth also closed on a previously announced deal to acquire the remaining 33% of a joint cultivation venture, BC Tweed, that Canopy established with a greenhouse grower in British Columbia, according to a news release. Canopy paid CA$375 million ($285 million) to close the deal.
BC Tweed currently has 1.7 million square feet of greenhouse grow space licensed for cannabis cultivation, out of roughly 3 million square feet of available greenhouse grow space.
In May, Canopy Growth became the first plant-touching cannabis firm to be listed on the New York Stock Exchange. The firm trades on the NYSE under CGC. The company also trades on the Toronto Stock Exchange as WEED.