Constellation Brands to make C$5B equity investment in Canopy Growth Corporation
November 01, 2018
5.00 Billion CAD
On August 15, 2018, Canopy Growth Corporation announced that Constellation Brands, Inc. will acquire 104.5 million shares from Canopy Growth for gross proceeds of approximately C$5 billion, representing approximately 38% ownership by Constellation Brands in Canopy Growth. In addition, Constellation Brands acquired 139.7 million common share purchase warrants that would, if exercised in full, result in Constellation Brands owning approximately 55% of Canopy Growth.
The investment will strengthen Canopy Growth's position as a leader in the global cannabis industry, as well as allow Canopy Growth to establish a global scale in the countries pursuing a federally permissible medical cannabis program. Canopy Growth will also benefit from Constellation Brands' proven capabilities as a leading Fortune 500 company, and its strong consumer and brand loyalty. The transaction is subject to approval by a majority of Canopy Growth's minority shareholders and to obtaining regulatory approvals, and is expected to close by the end of October 2018.
Canopy Growth is a medical marijuana company based in Smiths Falls, Ontario, and the first cannabis company in North America to be publicly traded. Canopy Growth has established a substantial global presence in 11 countries through its subsidiaries, Tweed and Spectrum Cannabis.
Constellation Brands, headquartered in New York, is an international producer and marketer of beer, wine and spirits. The company has over 100 brands in its portfolio, including Corona, Modelo, Robert Mondavi, Kim Crawford, Ruffino, SVEDKA Vodka and High West Whiskey.
McCarthy Tétrault LLP is advising Greenhill & Co. Canada Ltd., the exclusive financial advisor to Canopy Growth, with a team led by Robert Richardson.