When rapper and musician Drake launched his own cannabis company back on November 7th, 2019, he also announced the partnership between his More Life Growth Company and Canopy Growth, a fellow cannabis business. On Wednesday June 2nd, Canopy Growth Corporation and the "Fake Love" rapper's More Life Growth Company decided to part ways. The ending of this joint business venture is costing both parties millions of dollars, reportedly.
Drake had first teased the launch of More Life Growth Company back on November 5th, 2019. Agreements between the two included the details of the "Free Smoke" rapper holding sixty percent of More Life, while Canopy Growth held the other forty percent. In a press release for the More Life and Canopy Growth team up, Drake stated "the idea of being able to build something special in an industry that is ever growing has been inspiring. More Life and More Blessing."
The two entities have remained in business up until now. Upon the split, Canopy Growth has since removed their investment from the More Life Growth Company and its facility located in Scarborough. Canopy Growth converted More Life's Scarborough location into an R&D facility for Canopy, as confirmed by their director of communications: "We have indeed divested from More Life and the facility in Scarborough which had been intended to be part of that agreement is now Canopy Growth’s R&D facility, where we will work on plant science and science development projects."
Canopy also removed royalty assets from More Life that were worth almost C$33.7 million. The termination of this joint business venture follows the financial reports that were filed back in March of this year. The financial reports stated the termination of their sub-licensing contract due to impairments on Canopy's investment into More Life. Impairments on investments occur when the value of a product does not remain the same, or decreases, when a deal was originally brokered.
Will the More Life Growth Company survive the termination of this business deal? What business venture should Drake pursue next?