Fitch trims Canopy Growth

Fitch Ratings said it downgraded the long-term issuer default ratings for Canopy Growth Corp. and 11065220 Canada Inc. to CCC- from CCC. The agency also lowered the senior secured term loan facility to B-/RR1 from B/RR1.

“The downgrade reflects Fitch's view that the strategic linkage between Constellation Brands, Inc. (Constellation) and Canopy has materially diminished. Previously, Canopy's ratings reflected a one-notch uplift from its stand-alone credit profile of CCC-,” the agency said in a press release.

Fitch warned it could take further negative rating actions if Canopy pursues a repayment/refinancing of the remaining 2023 notes that it considered a distressed debt exchange per its criteria if liquidity appears constrained such that a default is probable, or if the company does not successfully execute its cultivation strategy.

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