Canopy Growth and Acreage Set Timeline for Major Acquisition Completion

Canopy Growth and Acreage Holdings: Anticipated Acquisition Closure

Canopy Growth Corporation (TSX: WEED) (NASDAQ: CGC), a global leader in the cannabis sector, has announced a significant update regarding its acquisition of Acreage Holdings, Inc., a prominent player in the U.S. cannabis market. According to recent communications, the company expects to finalize this strategic acquisition on or around December 9, 2024. This event marks another pivotal moment in the evolving landscape of the cannabis industry, where consolidation is shaping the market's future.

The arrangement between Canopy Growth and Acreage has been in the works since an agreement was reached on April 18, 2019, and has undergone several amendments leading up to the current phase. Under this acquisition plan, Canopy USA, a subsidiary of Canopy Growth, will acquire all outstanding shares of Acreage, thereby enabling Canopy Growth to consolidate its presence in the U.S. market.

The deal involves multiple layers of agreements, specifically the Fixed Share Arrangement Agreement and the Floating Share Arrangement Agreement, which determine the terms and conditions under which shares will be exchanged. Notably, concerns regarding the share price have arisen; Acreage indicated that if Canopy Shares do not exceed $5.00 prior to closing, holders of certain share classes may not receive compensation for their shares. This stipulation could impact investor responses and market perceptions leading up to the acquisition.

Acreage shareholders will soon receive letters of transmittal, guiding them on how to manage their share submissions related to the acquisition. Registered shareholders must send their respective share certificates to the Company’s transfer agent, Odyssey Trust Company, following specific instructions in the letter. Shareholders who maintain their shares via brokers are advised to coordinate with their intermediaries for seamless processing.

Due to recent labor disputes affecting Canada Post, shareholders may experience delays and are encouraged to reach out to Odyssey Trust for clarification on any issues regarding their shares. This highlights the complexities surrounding communications and logistics that can arise during significant corporate transactions.

In the context of the broader cannabis market, this acquisition reflects strategic maneuvers among industry leaders aiming to leverage established brands and operational capabilities. Canopy Growth has consistently pushed for innovation and premium product offerings, exemplified by its leading brands such as Tweed and Doja, while Acreage has built a strong retail presence through its brand The Botanist.

Furthermore, Canopy Growth's commitment to capitalize on the burgeoning U.S. cannabis market underlines the increasing recognition of cannabis as a legitimate and vital sector within the global economy. The integration of Acreage into Canopy’s ecosystem is anticipated to enhance product accessibility and market diversification—an essential move as consumer demand evolves alongside regulatory changes.

In the lead-up to the acquisition closure, both companies will need to communicate effectively with investors, ensuring that all parties are informed of developments and potential impacts resulting from this transaction. As the cannabis sector continues to mature, Canopy Growth and Acreage Holdings remain positioned to influence the direction of the industry.

About Canopy Growth

Canopy Growth is recognized as a trailblazer in the cannabis landscape, advocating for consumer health through innovative products and responsible practices. The company not only emphasizes product quality but also champions social equity within the cannabis sector, striving for a future where cannabis is widely accepted as a means for enhancing well-being.

About Acreage Holdings

Acreage Holdings stands as a multi-state operator in the U.S. cannabis industry, recognized for its commitment to quality and customer service. With brands like The Botanist and Superflux, Acreage aims to provide an extensive range of cannabis products. The company continues to develop its operations, focusing on delivering a branded experience that resonates with consumers across multiple states.