Canopy Growth is exiting the cannabis retail business with the signing of two deals that will see it divest its Tweed and Tokyo Smoke stores.
Posted yesterday at 5:28 p.m.
The Smiths Falls, Ont.-based cannabis company announced on Tuesday that it has sold all of its stores outside of Alberta, as well as Tokyo Smoke’s intellectual property, to OEG Retail Cannabis (OEGRC).
The latter is run by the Katz Group, owner of the Edmonton Oilers hockey team, which previously entered into a licensing agreement to own and operate all of Canopy’s Tokyo Smoke franchise stores in Ontario.
The new deals will see OEGRC, which already owns 64 Tokyo Smoke stores, take control of 23 Tokyo Smoke and Tweed stores in Manitoba, Saskatchewan and Newfoundland and Labrador, and force the rebranding of all Tweed stores. .
420 Investments will acquire five additional stores in Alberta, which will be rebranded under its Four20 retail banner.
Canopy did not share the value or financial terms of either deal.
However, the company explained that the deals are part of its efforts to reprioritize the high-end cannabis segment and reduce costs. Canopy has already tackled the latter aspect by cutting jobs and closing some facilities during the COVID-19 pandemic.
Workers at locations affected by the sales agreements will retain their jobs and Canopy will continue to own and operate the Tweed brand for its flowers, prerolls and other products.
The company will also end a 2019 master licensing agreement that allowed convenience store giant Alimentation Couche-Tard to operate a Tweed-branded store in London, Ont.