Canopy Growth (TSX: WEED) has unsurprisingly taken a loss on its investment into BioSteel, with the cannabis operator announcing the completion of the sale of the assets via proceedings under the Companies’ Creditors Arrangement Act.
Canopy was able to complete the sale of BioSteel Sports Nutrition, which involved the Canadian assets of the subsidiary, as well as the sale of BioSteel Manufacturing, for combined proceeds of $30.4 million. The company originally acquired a 72% stake in BioSteel for $50.7 million, before funneling hundreds of millions of dollars into the subsidiary in an effort to grow its distribution and sales.
READ: BioSteel Owes Millions To NHL, Professional Sports Teams: Bankruptcy Filing
This is the first time that the sales price for the entity had been disclosed, with bankruptcy filings notably blacking out the proposed sales figure.
“With the completion of these two sale transactions, we have completed another critical action to focus Canopy Growth’s business on our core cannabis operations and can now realize the proceeds of sale to further improve the Company’s balance sheet,” commented CFO Judy Hong on the sale.
Proceeds from the sale are to be used to repay debt as well as for working capital.
Canopy Growth last traded at $0.75 on the TSX.
Information for this briefing was found via Canopy Growth and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
