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Canopy Growth + Wana Brands for $300MM !!

Cannabis News & Events

I saw that Canopy Growth paid (or will pay) $300MM for Wana Brands once cannabis is legalized or decriminalized in the USA. Anyone else with thoughts on these types of deals? The risks for each party?

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Coree-Schmitz: I saw that Canopy Growth paid (or will pay) $300MM for Wana Brands once cannabis is legalized or decriminalized in the USA. Anyone else with thoughts on these types of deals? The risks for each party?

Wana Brands state they grossed $25M In 2019. Assuming they were able to grow revenue by 25% for the past two years then they would be at an annual gross revenue of $40M in 2021. That’s a significant number and would put it on par with Canopy’s entire Canadian medical segment.

Obviously that is me making assumptions about the current sales of Wana brands. However, even if they didn’t grow their business at all since 2019 and they were still bringing in $6.25M/quarter. That puts the brand slightly above BioSteel (as of Q1 FY22. I anticipate BioSteel will have grown massively by the end of Canopy’s FY22) and slightly above ThisWorks.

I like this acquisition, I like this brand. Canopy’s brand portfolio is absolutely the best in the business right now. They are developing themselves well into a cannabis CPG company.

As it stands though, Canopy is an amalgam of separate pieces held together through contracts until federal permissibility in the U.S. When they can consolidate their ecosystem under the Canopy name, they will be monstrous.

In the mean time, they should see significant growth of Quatreau, Martha, and BioSteel CBD in California after the recent CBD bill passing. That’s a big market and they have the production, distribution, and advertising pockets to get their brands into an enormous number of California stores. Their CBD ventures in that state will be a good thing to watch closely. How it plays out in California will be telling for when CBD gains supplement status across the nation and unlocks all of corporate America for CBD CPG products.

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