Canopy Growth has confirmed it intends to sell its Hershey Drive facility in Smiths Falls, Ontario, back to its orginical owner – the chocolate maker Hershey Canada – for CAD$53 million.
The sale is part of the company’s aim to transform to a simplified, asset-light operating model, however it will retain its Smiths Falls-based post-harvest manufacturing facility.
CEO of Canopy Growth, David Klein, stated: “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.
“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.”
Once the sale is complete, Canopy Growth will have sold a total of seven properties for approximately CAD$155 million since April 1, 2023, with sale proceeds being used to pay down the company’s senior secured credit facility.
The sale of the Facility follows the centraliSation of post-harvest manufacturing at the Company’s former beverage facility in Smiths Falls, as well as the consolidation of all flower cultivation in the Company’s purpose-built sites in Kincardine, Ontario, and Kelowna, British Columbia.