On November 17, 2017, Canopy Growth Corporation, Green House Holdings North America Inc. and its affiliate in the Netherlands, GHSC Trading B.V., National Concessions Group Inc. ("Organa Brands"), together three of the most successful global cannabis businesses, announced the planned creation of a collaborative joint venture.
To establish the joint venture, Canopy Growth will allocate a portion of ownership in Agripharm Corp., a 20,000 sq. ft. indoor growing facility located in Ontario, to its new partners. Canopy Growth will retain 40% ownership of Agripharm, while Green House and Organa Brands will own 40% and 20%, respectively. In exchange for the issuance of shares, Green House and Organa Brands have granted an exclusive, royalty-free licence in Canada to certain proprietary technology, trademarks, genetics, know-how and other intellectual property to Agripharm.
Canopy Rivers Corporation, a partly-owned subsidiary of Canopy Growth, has also entered into an agreement to provide the joint venture with up to $20 million in funding for the expansion of the facility in exchange for ongoing royalty payments and a warrant to acquire up to 4% of the issued and outstanding common shares.
The joint venture is expected to close on or about December 1, 2017.
Cassels Brock is acting for Canopy with a deal team that includes John Vettese, Cathy Mercer and Jonathan Sherman (Business, M&A and Cannabis), Bernice Karn (Intellectual Property and Cannabis) and Chuck Rich and Hilary Fender (Financial Services and Cannabis).
To read more about the joint venture, please click here.