Canopy Growth forms JV to convert Quebec tomato greenhouse to cannabis
MIRABEL, Que. - Canopy Growth Corp. has signed a joint-venture deal with Les Serres Stephane Bertrand Inc., a large-scale tomato greenhouse operator in Quebec.
The joint venture will lease a greenhouse used for tomatoes and other vegetables from Bertrand that will be upgraded and retrofitted for cannabis production by April 2018.
Canopy (TSX:WEED) says an application for this site has been submitted and subject to Health Canada and other regulatory approvals it expects being ready to begin production by May 2018.
The greenhouse holds an Ecocert "organic" certification.
Canopy has agreed to issue Bertrand $2.75 million in shares in four equal tranches, based on certain milestones. To fund the development of the joint venture, Canopy's Canopy Rivers subsidiary will also contribute $15 million in cash and Canopy has agreed to buy all of the cannabis produced during an initial term.
Canopy and its Canopy Rivers subsidiary will own a two-thirds stake in the joint venture, while Bertrand, which will operate the joint venture, will hold the remaining third.