Canopy Growth Corporation has just entered its fifth continent with its acquisition of African cannabis company Daddy Cann Lesotho PTY Ltd., which trades as “Highlands.”
Canopy Growth’s acquisition of the Lesotho-based Highlands marks the Canadian cannabis company’s first step into Africa. Highlands carries a license to cultivate, manufacture, hold, supply, export, import, and transport cannabis products.
The Kingdom of Lesotho is a high-altitude mountainous country that boasts more than 300 days of sunshine each year. In other words, it has the ideal humidity and perfect growing conditions for greenhouse cannabis cultivation.
Lesotho is also strategically positioned for Southern Africa’s upcoming medical cannabis industry, including a potential market in South Africa, which is in the process of developing its own medical cannabis laws and which has a population of 55 million.
What’s more, Lesotho was the first nation in Africa to legalize medical marijuana in 2017. And this, together with the very low resource and operating costs in Lesotho, gives Canopy Growth the advantage of producing large amounts of high-quality medical marijuana at a low cost.
Daddy Cann Lesotho or Highlands is a full seed to sale licensed cannabis producer with operations in the Kingdom of Lesotho, in Southern Africa. Highlands is one of the limited number of licensed cannabis producers and it boasts a full management team with more than 50 years of experience in operating a business in the country and in the Southern African region.
Highlands has the domestic and regional knowledge that Canopy Growth can count on. Canopy Growth can combine these with its expertise and global experience in order to establish a meaningful local presence.
Canopy Growth believes that Highlands will make a great partner in its commitment to serve the regional market and help with Lesotho’s economy through its future local cannabis production objective. Canopy Growth hopes to create jobs, as well as support lasting community engagement.
All of Highland’s key management team members will continue to lead the organization as members of the Canopy Growth family.
The $28.8-million acquisition deal
Under the terms of the agreement entered into between the two companies, Canopy Growth issued 666,362 common shares in Canopy Growth capital to Highlands’ sole shareholder upon closing. Moreover, subject meeting certain milestones, Canopy Growth will issue up to 333,281 additional common shares to Highlands’ sole shareholder.
This would bring in the total common shares issued to 999,643, based on the 30-day volume weighted average price of $28.763 of Canopy Growth’s common shares on the Toronto Stock Exchange as of May 11, 2018. Therefore, the total value of the consideration payable by Canopy Growth under the terms of the deal is approximately $28.8 million.
About Canopy Growth
Based in Smith Falls, Ontario, Canada, Canopy Growth is a world-leading diversified hemp and cannabis company. It offers curated cannabis varieties in oil, dried, and softgel capsule forms. It also offers distinct brands. Canopy Growth is driven by a commitment to building a world-class cannabis firm — one site, one product, and one country at a time — as well as by a passion for leadership.
Canopy Growth has market presence in North America, South America, Europe, Oceania, and now Africa.
Canopy Growth has already established partnerships with top and popular names in the cannabis sector like Snoop Dogg, DNA Genetics and Green House seeds, and alcohol company Constellation Brands, among many others. The company operates 10 cannabis production sites and has more than 2.4 million square feet of production capacity.
Canopy Growth is dedicated to educating healthcare practitioners, furthering the people’s understanding of cannabis, and conducting robust clinical research. Through its partly owned subsidiary, Canopy Health Innovations, the company has devoted millions of dollars toward cutting edge and commercializable research and intellectual property development. Through another partly owned subsidiary, Canopy Rivers Corporation, Canopy Growth is providing resources and investment to new game players in the market and is building a cannabis portfolio composed of stable cannabis-related investments.