Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) announced this morning that the company has agreed with Ebbu, Inc. to acquire IP and R&D advancements in exchange for C$429 million dollars in cash and stock. Canopy Growth Corp. believes that the acquisition will benefit a number of different vertically integrated assests that the company owns.
Ebbu, Inc. is an industrial hemp-based research company located in Evergreen, Colorado. Their company conducts extensive research in the production of Cannabidiol (CBD) oil via the propagation of industrial hemp. The intellectual property acquired by Canopy Growth will be utilized by their wholly-owned subsidiary Canopy Health Innovations to develop CBD based product formulations.
Canopy Growth will continue to employ Ebbu’s research team in the United States. The company has noted that they are and will continue to act within Federal Law in the United States and will not distribute illegal products in the country. Under the terms of the transaction Ebbu will receive $25 million in cash and will be issued 6,221,210 common shares of Canopy Growth Corporation.
“Beyond the technological edge this transaction provides, we are pursuing this acquisition because Canopy shares ebbu’s core ethos of building consumer trust. We collectively believe consumer trust is achieved by driving the scientific agenda needed to build predictable, repeatable outcomes and layering on brand power,” said Mark Zekulin, Co-CEO & President, Canopy Growth