The cannabis company is turning over some of its operations to OEG Retail
Deciding to withdraw from a market is not an overnight decision. Perhaps after a long time of deliberation, Canopy Growth felt that the cannabis retail business in Canada is not suitable to meet its goals, which is why it has now exited the field. It recently announced that the marijuana firm put its retail business across the North American country up for sale, including stores operating under the Tokyo Smoke and Tweed retail brands.
Canopy Growth’s existing licensee partner, which currently owns and operates the Tokyo Smoke stores in Ontario, OEG Retail Cannabis, recently made the decision to acquire Canopy’s 23 Tokyo Smoke and Tweed store locations. These stores are located in Manitoba, Labrador, Saskatchewan, and Newfoundland. In addition, Canopy is said to have entered into a deal with 420 Investments Ltd. under which FOUR20 agreed to acquire ownership of five retail stores in Alberta.
The Smiths Falls-based Canadian cannabis giant also said to have terminated a licensing agreement in Ontario for Alimentation Couche-Tard Inc. to operate Tweed-branded dispensaries. All of these moves are part of Canopy’s focus on continuing to move toward profitability status, wanting to become a company focused on premium brands.
“We are taking the next critical step in advancing Canopy as a leading premium brand-focused CPG cannabis company while furthering the Company’s strategy of investing in product innovation and distribution to drive revenue growth in the Canadian recreational market. By realizing these agreements with organizations that possess proven cannabis retail expertise, we are providing continuity for consumers and team members,” David Klein, the company’s CEO, said.
Regulatory approvals and other customary closing conditions are still required for the closing of both agreements to be completed. If given the green light, the Tokyo Smoke brand will be transferred to OEGRC and all stores purchased under the Tweed brand will be rebranded. Canopy Growth will continue to own and operate the Tweed brand.