Canopy Growth acquires Ace Valley

The company hopes to extend the brand's success with young consumers in Ontario to other markets and new product categories.
Canopy Growth Corporation-Canopy Growth Completes Acquisition of

Canopy Growth has acquired AV Cannabis Inc. – better known by its Ace Valley brand name – in a move that marries the former’s distribution network with the latter’s strong market position and suite of ready-to-enjoy products.

Ace Valley was founded by the same duo that created craft beer brand Ace Hill, aiming to use their experience growing a brand through its connection to a millennial audience into the cannabis category.

Since then, Ace Valley has focused its cannabis offering on product formats like pre-rolls, vapes and gummies, which has helped it build strong customer loyalty among Gen Z and millennial consumers, who over-index on “ready-to-enjoy” products. Ace Valley is also very strong in Ontario, where brand differentiation and market share have been hard to come by, holding at least a top ten position across all of the product formats it sells, according to data from the Ontario Cannabis Store.

The acquisition of Ace Valley falls in line with Canopy’s own push into the ready-to-enjoy space that began in 2019, though it has mostly been focused on vapes and beverages. But while Canopy does have a similar range of products, it plans to extend the Ace Valley brand across Canada and internationally via its larger distribution network, said Rade Kovacevic, the company’s president and chief product officer, in a release.

“Ace Valley’s complementary consumer positioning fits perfectly into Canopy Growth’s strategy of building authentic brands that truly resonate with consumers,” he added. The goal is to take what has worked with Ace Valley thus far and further extend it into new product categories and markets.

That’s something Ace Valley has experience with itself: it has a line of merchandise, as well as candles meant to smell like different Toronto neighbourhoods that have resonated with urban consumers.

This acquisition is also the latest example of consolidation in the cannabis industry: merger deals between Tilray and Aphria, as well as Hexo and Zenabis, are both set to close in the near future.