Canopy Growth Names Constellation's David Klein as CEO -- Update
December 09 2019 - 3:19PM
Dow Jones News
By Colin Kellaher
Canopy Growth Corp. said David Klein, who currently serves as
chief financial officer of major shareholder Constellation Brands
Inc., will join the cannabis company as chief executive, effective
Jan. 14.
Canopy said Mark Zekulin will step down as CEO and resign from
the board, effective Dec. 20.
Mr. Zekulin, a company founder who stepped in as CEO in July
when the Smith Falls, Ontario, company ousted Bruce Linton, had
previously announced plans to leave when a new CEO was
identified.
Mr. Klein has served as chairman of Canopy since October. The
company said it plans to name a new chairman when Mr. Klein takes
over as CEO.
Constellation Brands -- which produces and markets drinks such
as Corona beer, Meiomi wines and Casa Noble tequila -- holds a
roughly 36% stake in Canopy. The Victor, N.Y., company last year
had invested about $4 billion into the Canadian company.
In October, Constellation said its investment in Canopy had lost
about $1.3 billion of value in the quarter ended Aug. 31.
"Canopy's business is rapidly evolving, and the financial
results will likely be volatile," Mr. Klein said in October.
Earlier this year, Constellation Brands CEO Bill Newlands said he
wasn't pleased with the marijuana grower's results.
Canopy's stock price, through Friday, had fallen more than 63%
in Toronto trading since its high in April, reflecting in part
investor disenchantment with the cannabis sector after sales in
Canada got off to a slower start than expected following the
country's legalization of recreational use.
On Monday, Canopy share rose 13% to C$27.92. Constellation
Brands fell 1.4% to $181.10.
Constellation Brands named Garth Hankinson executive vice
president and chief financial officer, effective Jan. 13. Mr.
Hankinson, who joined Constellation in 2001, serves as senior vice
president of corporate development.
Canopy, which was started in 2013, sells medical marijuana
products -- including dried flower, oils and capsules -- in Canada,
Germany and the Czech Republic, as well as recreational products in
Canada.
Write to Colin Kellaher at colin.kellaher@wsj.com
(END) Dow Jones Newswires
December 09, 2019 15:04 ET (20:04 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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