Couche-Tard to Sell Marijuana

Retailer will open Tweed store in Ontario with Canopy Growth Corp. as partner
Photograph: Shutterstock

LAVAL, Quebec, and SMITHS FALLS, Ontario — Convenience-store retailer Alimentation Couche-Tard Inc. has entered into a multiyear agreement with Canopy Growth Corp., a diversified cannabis and hemp company, to sell recreational marijuana in Ontario.

Canada is the world’s largest legal pot marketplace, having decriminalized the use of recreational marijuana in October 2018. Canadian lawmakers voted to legalize recreational marijuana six months prior. In July 2017, Couche-Tard hired Montreal-based public relations firm Tact Intelligence-conseil to represent its interest in retail-marijuana sales.

Subsequent to this newly formed strategic partnership, and pending the results of a public consultation process, Couche-Tard has entered into a trademark license agreement with one of the winners of the Alcohol and Gaming Commission of Ontario’s (AGCO) expression of interest application lottery, which will operate a “Tweed” branded retail store in London, Ontario, once the process is complete. The lottery winner will have full ownership and control over the London store.

Constellation Brands,  the Victor, N.Y.-based importer of Corona and Modelo beers, Svedka vodka and Mark West wines, among other alcohol brands, invested $4 billion in Canopy Growth in August 2018.

Canopy Growth offers curated cannabis brands and varieties in dried, oil and soft-gel capsule forms. The Smith Falls, Ontario-based company operates Tweed retail stores in Saskatchewan, Manitoba and Newfoundland and Labrador and has entered into supply agreements with every Canadian province and territory.

Through this partnership, Alimentation Couche-Tard will leverage Canopy Growth's cannabis expertise and its experience with other age-restricted products to focus on the safe, responsible and lawful sale of cannabis, consistent with the legislation enacted by the federal and provincial governments.

The companies expect the Tweed store to open in April 2019. It will carry soft gels, oils and dried flower products along with a selection of accessories “that will allow customers to choose their own preferred way to consume cannabis, safely and responsibly,” the companies said.

The London location will serve as an important entry into the market that could lead to future international opportunities, the company said.

"Alimentation Couche-Tard is excited about taking a leadership role in the development of the cannabis retailing excellence in this major Canadian market. We believe the Ontario Cannabis Store and private retailers will coexist under a tightly regulated framework with common goals to protect public health and safety," said Brian Hannasch, president and CEO of Couche-Tard.

Canopy Growth's Tweed brand is a trusted cannabis source with an understanding of how to educate consumers on their cannabis needs, it said. Tweed offers an education-based sales experience in each of its retail stores.

"We are proud to be working with a leading global company like Alimentation Couche-Tard to advise and assist in bringing a trusted cannabis brand to the people of London, Ontario. Our brand is synonymous with having informed staff who can help consumers find the right option for them, whether they are a new or an experienced consumer," said Mark Zekulin, president and co-CEO of Canopy Growth.

Laval, Quebec-based Couche-Tard, owner of the Circle K c-store brand, has 9,943 convenience stores throughout North America, including 8,660 stores with motor fuel dispensing. Its North American network consists of 19 business units, including 15 in the United States covering 48 states and four in Canada covering all 10 provinces. In addition, through CrossAmerica Partners LP, Allentown, Pa., Couche-Tard supplies fuel under various brands to approximately 1,300 locations in the United States.

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