Canadian marijuana producer Hexo Corp. is entering the United States with the purchase of a Colorado facility.
The company has entered purchase and sale agreements for a 50,000-square-foot cannabis production facility in northern Colorado.
Hexo’s first facility in the United States involves a wholly owned U.S. subsidiary, according to a news release from last week.
The facility “is zoned for production of a full range of cannabinoids and offers multiple operational capabilities,” said Hexo.
The Ottawa, Ontario company’s CEO Sebastian St. Louis said that the purchase “will provide Hexo with the necessary infrastructure to begin production and enable the company to continue expanding our joint venture with Molson Coors to create Truss CBD-infused beverages, while also creating the necessary capacity to support future, non-beverage CPG partnerships.”
A shelf prospectus from May 7th had discussed the company’s attempts to acquire and retrofit a Colorado production facility.
Hexo confirmed to MJBizDaily that the facility referenced in the prospectus and the facility announced Friday are the same.
According to the disclosure document, the company will pay approximately $6 million to acquire the Colorado facility and $16.5 million-$49.5 million for retrofitting and improvements.
The facility will be used by Ontario-based Keystone Isolation Technologies USA (KIT USA), a Hexo joint venture with British Columbia extraction technology company Chroma Global Technologies, according to the prospectus.
“KIT USA will allow for in-state, Hexo-controlled cannabis extraction activity to support the manufacturing of CBD beverages and future products in the U.S.,” according to the prospectus.
The transaction is expected to close in the fourth quarter.