Published: Mon, April 22, 2019
Markets | By Otis Pena

Canadian cannabis giant bets on United States legalization

Canadian cannabis giant bets on United States legalization

However, the companies said Thursday that Canopy's acquisition of NY-based Acreage Holdings is contingent upon cannabis production and sales becoming legal at a federal level.

Today we announce a complex transaction with a simple objective.

Under the deal, Acreage shareholders will receive an immediate payment of approximately US$2.55 per subordinate voting share or US$300 million.

Plus Acreage boasts a roster of high profile backers, like former House Speaker John Boehner and Bill Weld, the former Governor of MA and a Republican Presidential challenger to Trump, who Borchardt said have "got people there in D.C." who see where the industry is heading. By combining Acreage's management team, licenses and assets with Canopy Growth's intellectual property and brands, there will be tremendous value creation for both companies' shareholders. "At the point when the privilege is practiced approaching Canopy Growth's profound assets will empower us to improve, create and convey quality cannabis marks over the USA also, keep extending our USA impression".

However, once the deal is made, it will give Canopy Growth the right to all the products of Acreage Holdings.

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By doing so, Canopy Growth basically leveraged the whole United States cannabis market with just $300 million dollars.

A number of such deals have been done in the past between Canadian and us companies to avoid legal issues. The shares would yield him roughly $536,000 in cash if the deal is approved and Canopy stock worth about $5.4 million as of Thursday's close. Constellation shares were up 3.6%, and have gained 18% in the last 12 months, while the S&P 500 has gained 7%.Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move.

The deal in which Canopy Growth will acquire Acreage Holdings once cannabis is legal in America implies that the legalization will happen sooner than we think.

At the time, Linton called it "rocket fuel" for Canopy's global ambitions as more markets legalize cannabis around the world.

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