Cannabis company Canopy Growth Corporation has agreed to sell its Hershey Drive facility in Smith Falls, Ontario, Canada, back to confectionery giant Hershey, for CAD 53 million (approx. $39.2 million).
The move aligns with the company’s strategy to transition towards a streamlined and “asset-light operating model”. The company said that Canopy Growth will “retain its Smiths Falls-based post-harvest manufacturing facility.”
The sale of the facility follows comes after the company centralised post-harvest manufacturing at its previous beverage facility in Smith Falls. Additionally, all flower cultivation has been consolidated at the company’s purpose-built sites in Kincardine, Ontario, and Kelowna, British Columbia.
David Klein, CEO of Canopy Growth, said: “We are pleased to have reached an agreement with Hershey on this important sale. This is the latest milestone in our focused effort to reduce costs and further enhance our balance sheet. Each of the steps we have taken as part of our transformation to a simplified, asset-light operating model supports our ability to deliver in-demand products from brands our customers love, with greater agility and less execution risk.”
He continued: “Once again, we have demonstrated Canopy Growth’s ability to achieve significant organisational and operational change to position the company for future growth in the Canadian market.”
Jason Reiman, chief supply chain officer at The Hershey Company, added: “Our intent to purchase the Hershey Drive property in Smiths Falls is another example of the strategic investments we’re making in our supply chain network and our Canadian operations to support growth”.
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