Canadian cannabis company, Canopy Growth Corp. (CGC, -4.86% WEED, -4.79%), announced its intention to seek approval from shareholders to close its recent acquisitions of cannabis-related U.S.-based businesses. Under the name Canopy USA, the company plans to combine the acquired businesses, namely Jetty, Wana, and Acreage with its existing 17% stake in TerrAscend.
CEO David Klein expressed confidence in Canopy USA’s progress, stating that upon receiving shareholder approval, the company will proceed with finalizing these acquisitions. He emphasized the importance of this development as it enables Canopy Growth to comply with Nasdaq requirements. Currently, plant-touching companies are prohibited from listing on Nasdaq due to federal law categorizing cannabis as a Schedule I drug.
In order to meet these regulations, Canopy Growth intends to report the financials of Canopy USA separately as a “non-controlling interest”, ensuring compliance while unlocking new opportunities for growth.
The company plans to file a definitive proxy with the Securities and Exchange Commission (SEC) on or around February 13th. A shareholder vote is scheduled for April 12th to decide on the proposed structure.
While Canopy Growth’s stock witnessed a slight increase of 0.2% during premarket trading, it remains uncertain whether the SEC has granted approval for the proposed plan. The announcement comes alongside the release of the company’s earnings report for the fiscal third quarter.