Canopy Rivers Announces Significant Contract Manufacturing Agreement Between Portfolio Partners PharmHouse and TerrAscend
NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRES
TORONTO, Oct. 15, 2018 (GLOBE NEWSWIRE) - Canopy Rivers Inc. (“Canopy Rivers” or the “Company”) (TSXV:RIV) is pleased to announce PharmHouse Inc. (“PharmHouse”), has entered into an offtake agreement (the “Agreement”) to supply TerrAscend Canada Inc. (“TerrAscend Canada”), a wholly-owned subsidiary of TerrAscend Corp. (“TerrAscend”) (CSE:TER), with cannabis products from 20% of the flowering space at its 1.3 million square foot greenhouse facility until December 31, 2021.
Both PharmHouse and TerrAscend are substantial pillars in the Canopy Rivers’ investment portfolio, and this Agreement represents a de-risking milestone for each company. Leveraging the anticipated throughput and low cost of production from the PharmHouse facility positions TerrAscend Canada with a sizeable source of dried flower and trim for packaging, processing, and distribution throughout the TerrAscend logistics platform without the need for considerable capital expenditures. For PharmHouse, the Agreement provides increased sales visibility and financial de-risking for a significant portion of the expected production from its flagship facility.
“We are seeing promising synergies develop within the Canopy Rivers portfolio,” said Bruce Linton, Chairman and Acting CEO of Canopy Rivers, and co-CEO of Canopy Growth Corporation. “We set out to create an ecosystem of complementary cannabis companies that can strategically support one another. This collaborative Agreement between PharmHouse and TerrAscend Canada demonstrates our commitment to provide more than just growth capital to our partners,” continued Linton. “Through the unique access to Canopy Growth, we continue to develop an environment that encourages and supports synergy and mutually advantageous opportunities for value creation across the entire Canopy Rivers platform.”
The PharmHouse joint venture, of which Canopy Rivers owns 49%, operates out of approximately 1.3 million square feet of newly built greenhouse infrastructure under glass in Leamington, Ontario. Canopy Rivers, along with the joint venture partners are actively upgrading and supplementing the facility in preparation for licensing. With this Agreement in place, and pending the receipt of a cultivation licence from Health Canada, PharmHouse has orders for an aggregate 30% of the flowering space at its facility until December 31, 2020.
Fostering opportunities for collaboration throughout the Canopy Rivers ecosystem is a key element and differentiator in the Company’s value proposition. This Agreement is another great example of the portfolio partners leveraging their respective areas of specialization within the cannabis value chain in a manner that is financially and operationally beneficial for all parties.
About Canopy Rivers Inc.
Canopy Rivers is a unique investment and operating platform structured to pursue investment opportunities in the emerging global cannabis sector. Canopy Rivers works collaboratively with Canopy Growth (TSX:WEED, NYSE: CGC) to identify strategic counterparties seeking financial and/or operating support. Canopy Rivers has developed an investment ecosystem of complementary cannabis operating companies that represent various segments of the value chain across the emerging cannabis sector. As the portfolio continues to develop, constituents will be provided with opportunities to work with Canopy Growth and collaborate among themselves, which Canopy Rivers believes will maximize value for its shareholders and foster an environment of innovation, synergy and value creation for the entire ecosystem.
This news release contains statements which constitute “forward-looking information” within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of the Company with respect to future business activities and operating performance. Forward-looking information is often identified by the words “may”, “would”, “could”, “should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” or similar expressions and includes information regarding PharmHouse’s anticipated throughput and low cost of production; supplementing TerrAscend Canada’s logistics platform; the anticipated synergies and value creation across the Company’s platform; PharmHouse’s development in preparation for providing Health Canada with notice of readiness for a cultivation license; receipt of a cultivation license for PharmHouse; and expectations for other economic, business, and/or competitive factors.
Investors are cautioned that forward-looking information is not based on historical facts but instead reflects management’s expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although the Company believes that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the Company. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are the following: regulatory and licensing risks; construction, development and associated financing risks; the ability of PharmHouse to obtain a license under applicable legislation in Canada; the ability for TerrAscend to secure distribution and sales channels; changes in general economic, business and political conditions, including changes in the financial markets; potential conflicts of interest; the Canadian regulatory landscape and enforcement related to cannabis, including political risks and risks relating to regulatory change; changes in applicable laws; compliance with extensive government regulation; public opinion and perception of the cannabis industry; and the risk factors set out in the joint management information circular of Canopy Rivers Corporation and the Company dated August 8, 2018, filed with Canadian securities regulators and available on the Company’s profile on SEDAR at www.sedar.com.
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information, please contact:
Canopy Rivers Inc.
Sr. Director, Investor Relations & Communications
Executive Vice President, Strategy