Ottawa-headquartered HEXO is making big moves, announcing plans on Monday to acquire 48 North and forging a path into the US market.
Last time we checked in, 48North was winding down its two-year-old outdoor cultivation facility due to the glut of unsold cannabis. That didn’t scare off HEXO co-founder and CEO Sebastian St. Louis, who cites the company’s memorable branding and portfolio as two reasons why they’re moving ahead with an all-stock $50 million deal.
“48North’s innovative product portfolio complements HEXO’s existing brands which, combined with their additional market penetration, will further strengthen HEXO’s position in the Canadian market.” he said in a press release.
Dipping a toe into Colorado
HEXO is also blazing its trail into the US market with the acquisition of a 50,000 square-foot processing facility in northern Colorado, which will initially allow the company to produce infused drinks south of the border.
“The facility will provide HEXO with the necessary infrastructure to begin production and enable the company to continue expanding our joint-venture with Molson Coors to create Truss CBD-infused beverages, while also creating the necessary capacity to support future, non-beverage CPG partnerships,” St. Louis said in a statement.
Don’t forget about HEXO’s February announcement that the company is also acquiring Zenabis in an all-stock deal valued at about $235 million — another cultivator with a long list of challenges — with an eye toward Europe. Let’s hope that by moving beyond Canada while strengthening the portfolio at home will make all the difference.