HEXO Looks to Streamline Operations After Recent Acquisitions

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The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

After a recent acquisition spree, HEXO Corp. HEXO says it is streamlining its operations to core facilities as part of its ongoing integration plan.

In recent months, Quebec, Canada-based HEXO has acquired:

• Zenabis, a licensed Canadian cultivator of medical and recreational cannabis, in an all-share transaction valued at about CA$235 million
• 48North, a licensed Canadian cannabis producer with a portfolio of products, in an all-share transaction valued at about CA$50 million
• Redecan, Canada’s largest privately-owned licensed cannabis producer, in a $400 million cash transaction

HEXO plans to close two 48North plants in Ontario at the end of January. It also will decommission the Zenabis facility in Nova Scotia by the end of February. The closures affect about 155 employees, who the company will relocate if they take jobs at another HEXO facility.

HEXO is a consumer packaged goods cannabis company that serves the Canadian adult-use market under its HEXO, HEXO Plus, Up, Original Stash, and Bake Sale brands and the medical market under HEXO medical cannabis. 

New Leadership

In October, HEXO named Scott Cooper as its new president and CEO after Sebastian St-Louis stepped down. Cooper is no stranger to the company, having served as president and CEO of Truss Beverage Co., a joint venture between Molson Coors Beverage Co. TAP and HEXO. HEXO hopes the partnership has laid the groundwork for it to expand into the U.S. market.

In May, HEXO agreed to buy a 50,000-square-foot cannabis production facility in northern Colorado, where it is deploying its Powered by HEXO strategy to attempt to bring best-in-class research and technology, regulatory expertise, and superior ingredients together with product knowledge, deep consumer understanding, and established global distribution networks.

“Without question, HEXO presents one of the most exciting opportunities in the cannabis industry,” Cooper said at the time of the announcement. “I look forward to working with the team to build upon the strong foundation already built, particularly through the company’s recent acquisitions and to drive growth and profitability through the efficient commercialization of cannabis consumer packaged goods.”

During his tenure at Truss, Cooper helped the company take a leading share of Canada’s infused beverage market, although industrywide sales for the category amounted to only CA$23.6 million ($19.5 million) during the first half of the year.

Before taking the helm at Truss, Cooper held senior positions at Molson Coors, including chief innovation officer, as well as at Canadian food retailer Sobeys Inc. and consumer goods company Unilever PLC UL.

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.