Canadian cannabis giant Canopy Growth is (kind of) acquiring Wana Brands, the #1 cannabis edibles brand in North America by market share – per Headset data.

According to information procured exclusively ahead of an official announcement, the deal features a similar structure to the one Canopy struck with Acreage Holdings a couple of years ago. Under the agreement, the Canadian operator will acquire the right to purchase Wana (comprised of Mountain High Products, Wana Wellness and The Cima Group) once THC becomes federally legal in the U.S.

The call option to acquire 100% of the membership interests in each Wana entity is being acquired by Canopy for upfront cash payment of $297.5 million.

When Canopy decides to move forward with the acquisition, it will pay 15% of the fair market value of the entities being acquired. Until the purchase is complete, thought Canopy Growth will have no economic, voting or controlling interest in Wana, which will continue to operate independently.

“Through the agreement with Wana, Canopy is adding another industry leading brand to power our rapid growth across the U.S. Wana has built a successful business using an asset-light licensing model, allowing them to scale across North America,” David Klein, CEO of Canopy Growth, said in an exclusive interview.

Breaking down the key strategic benefits of the acquisition, Klein explained Wana:

• Strengthens Canopy Growth’s U.S. ecosystem.
• Provides exposure to one of the fastest growing segments in both the U.S. and Canadian cannabis markets: edibles.
• Would automatically make Canopy a leader in the edibles category.
• Increases Canopy’s exposure to the U.S. market upon federal legalization.
• Represents an opportunity to acquire a profitable and highly scalable business.

“Edibles play a key role in attracting new consumers and adding the #1 edibles brand in North America strengthens our competitive position on both sides of the border,” added Klein. “In addition to our existing relationships with Acreage and TerrAscend, the agreement with Wana furthers Canopy’s positioning for rapid entry post-permissibility to the US THC market.”

Wana manufactures and sells gummies in the Colorado and licenses its intellectual property to partners in 11 other states.

Nancy Whiteman, CEO and co-founder of Wana Brands added, “If we could outline what an ideal relationship in the cannabis industry would look like, this would be it. Wana is a bit of a unicorn as a woman-owned, boot strapped and profitable business. We are generating significant growth and have become the leading edibles brand in North America without taking on investors or debt.

“However, we have known all along that there would come a time when we could no longer do it alone. The breakneck pace of growth, the competitive environment and the potential to take advantage of strategic opportunities requires a degree of both outside-of-the-industry experience, as well as access to capital that we simply didn’t have. Canopy of course fulfills those needs, and more,” she added.

What Wana couldn’t have known going into discussions early on was how closely its interests and culture would align with those of Canopy, Whiteman continued.

“As we began to get clarity on how our roadmaps dovetailed, it became very clear that this was not only the right partnership for us, but that there is also huge potential to be the driving force in edibles and the industry as a whole as a single team,” Whiteman concluded.