Canopy Growth CEO: Acreage will help us dominate the U.S. market
Canopy Growth Corp. (WEED.TO) chose to acquire Acreage Holdings Inc. (ACRGu.CD) from a list of U.S. marijuana operators because of the reputational risk its board of directors would face if anything goes wrong, said the Canadian cannabis producer’s co-chief executive officer.
“With Acreage, they had this board that had a great deal of reputational risk if anything went funny,” Bruce Linton told BNN Bloomberg’s Andrew Bell in an interview Thursday.
“And so we knew for sure they’re going to be extremely well-governed because in the period of time from now until we bring them over, we can’t go and tell them how to run their business. They have to run it in a proper and well-accounted way.”
Acreage’s board of directors includes many high-profile members including former Canadian Prime Minister Brian Mulroney and former Speaker of the U.S. House of Representatives John Boehner.
Linton said the choice came down to three well-run, multi-state American cannabis operators – which he said he could not name but “were all very good” – after initially meeting with five or six firms in Smiths Falls, Ont., where Canopy is based.
Canopy assessed the companies’ structures, their levels of interest, how they could work together, the firms’ boards and their governance, Linton said.
“Acreage had [a presence in] 20 states, a great board, good governance, were very rational about pricing and purpose,” he added. “And they recognized their world is a tough world, and our technologies and backing will make it a lot easier to be big.”
Canopy’s blockbuster US$3.4-billion acquisition of Acreage, announced last month, is expected to be the first tie-up of its kind. The deal is contingent on marijuana becoming federally permissible south of the border.