Canopy Growth’s planned entry into the U.S. marijuana market has hit another hurdle – this time over the cannabis producer’s ties to its largest investor.
Fitch Ratings downgraded its credit assessment of the Ontario, Canada-based Canopy to CCC-, one of its lowest ratings.
CCC carries “substantial credit risk” such that default is a real possibility.
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It’s the second time in six months that Canopy’s credit rating has come under scrutiny from Fitch.
The New York-based ratings company said it believes the strategic link between Canopy’s biggest investor, alcohol giant Constellation Brands (CBI), and the licensed cannabis producer “has materially diminished” after Canopy announced its plan to speed its entry into the U.S. THC market.
“As such, Canopy’s ratings no longer benefit from a one-notch uplift from its standalone credit profile,” Fitch said.
In a statement to MJBizDaily, a Canopy spokesperson said Constellation Brands remains vested in Canopy’s success
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