Canopy Growth Corporation announced on Thursday that it has acquired Germany based Cannabinoid Compound Company, better known as C3, for €225.9 million, which is equivalent to around $342.9 million Canadian Dollars. The acquisition Cannabinoid Compound Company will help Canopy Growth Corporation to establish a strong foothold in the European market in terms of transforming its ability to supply single cannabinoid medicines in the continent.
The Cannabinoid Compound Company has been working to develop a wealth of knowledge and intellectual property over the last 20 years and the acquisition will give Canopy Growth Corporation access to the know-how in the latest synthetic and natural cannabis medical products. Armed with the acquired intellectual properties, it will help Canopy Growth Corporation to further its ambitions to expand operations in the broader European market.
Along with its full-spectrum medical cannabis offering, the acquisition of the Cannabinoid Compound Company will enable the Canopy Growth Corporation to market single cannabinoid medicines.
Bionorica SE founded Cannabinoid Compound Company and it is one of the world’s leading producers of scientifically researched herbal medicines.
Why Canopy Growth Corporation Acquired Cannabinoid Compound Company (C3)
The Cannabinoid Compound Company is best known for developing a pure chemical compound that utilizes standardized concentrations of tetrahydrocannabinol (THC). It is an active ingredient in Cannabis that has diversified utility in developing medical products with pharmacological effects.
Currently, the Cannabinoid Compound Company markets its range of products in key European markets, including Austria, Denmark, and Germany. Its medical products are used as a treatment for nausea and vomiting refractory as an alternative to conventional treatment with major implications in oncology and palliative care. Moreover, it has vast potential in treating cancer pain.
The main five products of the Cannabinoid Compound Company are available in the European market. Moreover, under German regulation, Cannabinoid Compound Company’s products can be prescribed for chronic pain and for any condition in palliative care. In 2018, the company generated €27.1 million from its operation and the acquisition will certainly help Canopy Growth Corporation to obtain a large chunk of the market share in these areas.
Upside Potential of Canopy Growth Corporation
Along with its series of acquisitions in the U.S., over the last few months, the Canopy Growth Corporation has made some major strategic acquisitions in the key European market. Besides acquiring C3, it also acquired Spanish licensed Cannabis producer Cafina in April 2019.
After the acquisition of Cafina, Canopy Growth Corporation’s stock broke above the downtrend line on April 18, 2019. Over the past two weeks, it has gone up to test the key resistance level near the $52.00 per share.
As the acquisitions of C3 will enable the Canopy Growth Corporation to accelerate its European expansion strategy, it will certainly have a positive impact on the bottom line of the company in the coming quarters.
Moreover, from a technical point of view, the Commodity Channel Index reading on the daily chart has fallen way too fast in the last few days in relation to the actual price action. Such divergence supports a bullish thesis. Hence, there is a good possibility that we will see the stock breaking above the $52.00 per share level in the coming days.
- Source: First Appeared Here
- Published Time: 2019-05-02 15:53:19
The views and opinions expressed in the article Canopy Growth (CGC) Acquires Germany Based Medical Cannabis Producer C3 to Accelerate European Expansion do not reflect that of 48coins, nor of its originally published source. Article does not constitute financial advice. Kindly proceed with caution and always do your own research..
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