Canadian cannabis producer Organigram Global has announced plans to acquire Germany’s ‘second-largest’ medical cannabis company, Sanity Group, in a deal valuing it at up to €250m, in what is believed to be the largest acquisition of a German cannabis business by a North American operator to date.
The deal marks the latest and most significant consolidation event in the booming German market, as North America’s largest cannabis operators accelerate their expansion in the European medical cannabis market.
It also marks the culmination of a business relationship which has gradually expanded in scope since its inception in 2022, when British American Tobacco (BAT) led Sanity’s €37.6m Series B fundraise, having already taken a near-20 percent stake in Organigram the previous year.
The tobacco giant’s fingerprints are visible throughout the proposed acquisition, and BAT has opted to receive Organigram shares rather than cash for its stake in Sanity, while simultaneously injecting a further C$65.2m into Organigram to help fund the deal.
“The proposed acquisition of Sanity Group marks a pivotal step in Organigram’s global expansion strategy as a leader in the rapidly expanding cannabis industry,” said James Yamanaka, the newly appointed CEO of Organigram, who took the role in January having previously served as Global Head of Strategy at BAT.
“This transformational acquisition will bring together two market leaders, extend our commercial footprint into Europe, and strengthen our competitive edge in the world’s largest federally legal cannabis markets.”
