Canopy Growth certainly made Drake’s “Hotline Bling” when they approached the international hip-hop star with a partnership deal.
Canopy Growth (NYSE:CGC,TSX:WEED) is adding another international star to its lineup of celebrity partnerships.
On Thursday (November 7), the cannabis producer announced its newest partnership: Canadian hip hop artist Drake.
Drake, whose real name is Aubrey Drake Graham, and the Ontario-based cannabis firm are teaming up to launch the More Life Growth Company, a licensed cannabis producer joint venture based out of Toronto, Canada.
“The opportunity to partner with a world-class company like Canopy Growth on a global scale is really exciting,” Drake said in a statement. “The idea of being able to build something special in an industry that is ever growing has been inspiring.”
The deal locks Drake in as the majority shareholder of More Life with a 60 percent ownership interest in the venture, while Canopy Growth will hold the remaining stake.
The new venture, which is named in homage to a mixtape the rapper released in 2017, will allow Drake to sell recreational cannabis and cannabis accessories across Canada and abroad.
The More Life facility will be based in Canopy Growth’s existing site in Scarborough, Ontario, with the producer providing day-to-day operations and maintenance and holding the rights to distribute products produced at the facility.
Canopy Growth said the More Life brand will be focused on wellness with a global reach and more details about the joint venture will be shared in the coming weeks.
The firm added the “In My Feelings” singer’s long established career in music, television and fashion makes him well-positioned to take on the industry.
“Drake’s perspective as a culture leader and entrepreneur combined with Canopy Growth’s breadth of cannabis knowledge will allow our new company to bring an unmatched cannabis experience to global markets,” said Canopy Growth CEO Mark Zekulin in a statement.
Drake’s addition to Canopy Growth could help boost the company’s profile following losses of almost C$1.3 billion reported in its quarterly results for Q1 2020 and the firing of one of its founders, former company CEO Bruce Linton, in July.
An Instagram page for More Life has been set up and already boasts a following of over 15,000.
The new company comes with its own board of directors, for which Canopy Growth will nominate two executives.
Drake has given More Life Growth Company to right to “exclusively exploit certain intellectual property and brands” in association with the marketing and sale of products in and out of Canada.
Those international rights could expire after 18 months in the event More Life Growth doesn’t meet certain performance milestones. Within Canada, however, Canopy Growth has sub-licensed those rights and will be the exclusive distributor of all More Life products.
Drake comes as one in a growing roster of celebrity endorsements for Canopy Growth, which previously announced partnerships with fellow rapper Snoop Dogg, lifestyle guru Martha Stewart and comedian Seth Rogen.
There wasn’t much movement for Canopy Growth as the markets opened on Thursday. In Toronto, shares were down 1.5 percent to C$25.78 as of 10:09 a.m. EDT.
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Securities Disclosure: I, Danielle Edwards, hold no direct investment interest in any company mentioned in this article.