The deal will see the cannabis giant acquire a 72 per cent stake in the Toronto-based energy sports drink maker with an agreed upon path to total ownership. Financial terms of the deal were not immediately released.
“This is a very exciting strategic opportunity to take a known, established product and brand that speaks for itself and to layer in CBD and bring a differentiated offering into the marketplace,” Canopy Growth CEO Mark Zekulin told Yahoo Finance on Wednesday.
“This is a product that people genuinely use and genuinely believe in.”
Founded in 2009, BioSteel is best known for its pink sports drink used by professional athletes. The company’s products have been purchased by over 70 per cent of the teams in North America’s four major sports leagues. Brand ambassadors include Ezekiel Elliott of the Dallas Cowboys, Connor McDavid of the Edmonton Oilers, tennis player Eugenie Bouchard, Andrew Wiggins with the Minnesota Timberwolves and NHL Hall of Famer Wayne Gretzky.
Non-intoxicating cannabidiol, or CBD, has long been touted as the next big trend in sports beverages and wellness. The cannabis compound is widely-believed to have therapeutic qualities beneficial to athletes. BioSteel has an agreement to use Cowboys running back Elliott as the primary endorser of CBD products if it is officially permitted by the NFL.
“This isn’t about endorsements,” Zekulin added. “Whether it’s the old BioSteel that works for them or the BioSteel with CBD, and then whether they want to talk about it or not, that’s their business. For us, we are focused on putting out the best product possible.”
“The use and acceptance of CBD-based products in the professional sports landscape has changed. We have witnessed the negative effects of prescription painkillers and athletes are looking for healthier alternatives,” said Michael Cammalleri, co-founder and co-CEO of BioSteel in a news release accompanying the announcement. “Its presence is already commonplace amongst NHL players and as a regular CBD user myself, I couldn’t be more proud to champion BioSteel’s evolution and leadership in this space.”