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Mar 21, 2019

Canopy acquires hemp company AgriNextUSA, ramping up U.S. expansion

Canopy expanding hemp business with AgriNextUSA acquisition

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Canadian cannabis producer Canopy Growth Corp. announced Thursday it is acquiring U.S. hemp company AgriNextUSA as it seeks to ramp up its expansion south of the border.

Terms of the deal were not disclosed, but Canopy said in a release that the cash purchase “is not material” to its current position.

The Smith Falls, Ont.-based pot firm’s acquisition comes after the U.S. enacted the Farm Bill last year, which paved the way for the legalization of hemp-derived cannabidiol (CBD), a chemical compound that doesn’t make users high but proponents say can be used for health and wellness purposes.  

"The United States is the next stop on Canopy Growth's desired path to becoming a leading, revenue-generating company focused on all aspects of cannabinoids and their potential," said Bruce Linton, co-CEO and chairman of Canopy Growth, in a release.                

As part of the deal, AgriNextUSA CEO Geoff Whaling – who is also chairman of the National Hemp Association – will join Canopy’s U.S. division as a strategic advisor for hemp and CBD products, as the Canadian pot firm works to build hemp industrial parks in the U.S.

Canopy said it plans to develop a model with AgriNextUSA in which American farmers will have a single, regional destination for hemp crops to be turned into a wide range of  products.

The move comes after Canopy received a license in January to produce and process industrial hemp in New York, where it plans to invest up to US$150 million to build an industrial park in the state.

"By working with Canopy Growth, we will turn our vision into a reality, one that helps American farmers, small and medium-sized business owners, and the next cohort of innovators who see the extraordinary potential that hemp has to offer," Whaling said in a release.

AgriNextUSA is described in an article on the Pennsylvania Hemp Industry Council website as a Pennsylvania-based holding company that established distribution rights for Charlotte’s Web hemp oil products in the state. It is also described as an owner of a farming and processing facility for hemp products.

Cannabis Canada is BNN Bloomberg’s in-depth series exploring the stunning formation of the entirely new – and controversial – Canadian recreational marijuana industry. Read more from the special series here and subscribe to our Cannabis Canada newsletter to have the latest marijuana news delivered directly to your inbox every day.