Cash-rich Canopy Growth bought global vaporizer leader Storz & Bickel for 220 million Canadian dollars ($160 million) in a bid to improve its portfolio of intellectual property.
The all-cash deal is also intended to position Canopy to capitalize on the next wave of federally regulated products in Canada and around the world, the Smiths Falls, Ontario company said in a news release.
It is the first significant international acquisition in the Canadian cannabis sector since a report earlier this week alleged that rival licensed producer Aphria massively overpaid for assets in the Caribbean and Latin America to benefit company insiders. Aphria disputes those claims.
“Because there is pressure out there for transparency, we decided to put that in.”
Canopy also disclosed that Greenhill & Co. Canada acted as financial adviser and provided a fairness opinion to its board during the acquisition process.
Storz & Bickel has an IP portfolio that includes 17 filed patents, and the company has exported devices to 50 markets around the world.
The Tuttlingen, Germany-based firm employs about 100 people and designs and manufactures medically approved vaporizers.
The company’s founders, Markus Storz and Jürgen Bickel, will remain as a part of the organization.
Canopy declined to disclose Storz & Bickel’s annual revenue.
“We view this as a marquee acquisition of the most recognized technology company in the industry,” Canopy co-CEO Bruce Linton said in the release. “This Company is well positioned for the next wave of federally regulated products in Canada beyond dried flower and edible oils.”
As of Sept. 30, Canopy had cash and cash equivalents of CA$429 million.
Matt Lamers can be reached at [email protected]
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