Organigram Strikes Deal to Acquire Sanity Group

TORONTO-BERLIN – Organigram Global Inc. has signed a definitive agreement to purchase the remaining shares of Berlin-based Sanity Group GmbH that it does not already hold. The transaction builds on Organigram’s earlier minority stake and supply partnership with the German company, marking a deeper commitment to the European market.

The deal values Sanity Group at up to €227.2 million if earnout targets are met, with €113.4 million in upfront consideration (€80 million cash and €33.4 million in Organigram shares at C$3.00 per share, a 71% premium to the prior day’s TSX close of C$1.75) and up to €113.8 million in performance-linked payments (€20 million cash and up to €93.8 million in shares, priced via 20-day VWAP with a C$3.00 floor and C$4.00 cap). This structure incentivizes continued rapid growth while protecting Organigram from overpaying if results fall short.

The purchase will be financed through cash on hand (including restricted Jupiter funds), a new credit facility arranged with ATB Financial and participating lenders, and a C$65.2 million equity investment from British American Tobacco p.l.c. (BAT) via its subsidiary BT DE Investments, a shareholder in both entities. BAT has elected to receive Organigram shares in lieu of cash for its Sanity Group interest.

Sanity Group, founded in 2018 and headquartered in Berlin, has built a strong position in medical Cannabis, participation in Swiss recreational pilot programs, and wellbeing products. Its revenue trajectory stands out: €9 million in 2023, €19 million in 2024, and €60 million in 2025, including €19 million in the final quarter alone. The company achieved positive EBITDA in 2025, with gross margins rising from 15% in 2023 to 47% in 2025. Sanity has climbed to an estimated #2 market share in Germany as of early 2026, up from #5 a year earlier.

Germany stands as the core opportunity. The medical Cannabis market there exceeded €2 billion in 2025 and projected to surpass €4.5 billion by 2028, driven by steady annual growth and patient penetration approaching 2% of the population – levels comparable to established markets in Israel and Australia.

For Organigram, which holds the leading share in Canada’s adult-use recreational segment, the acquisition shifts strategy from an exporter role to a fully integrated European operator. Sanity provides a vertically integrated platform, regulatory and medical-market knowledge, access to Switzerland’s two legal Cannabis specialty stores under pilot projects, and expansion pathways into the UK, Poland, and Czechia. It also brings established supply-chain relationships and leadership from CEO Finn Age Hänsel, whose European expertise complements Organigram’s cultivation, manufacturing, and R&D strengths.

Completion of the transaction is subject to approval by Organigram shareholders, regulatory clearances including TSX listing approval, German foreign investment review, and other customary closing conditions. The company anticipates closing in Q2 2026 and has described the acquisition as accretive, expected to enhance scale, revenue, and profitability.

Wrapping up, the earnout structure prudently ties a significant portion of the purchase price to demonstrated results, mitigating execution risk while capitalizing on Sanity Group’s established momentum in an expanding, federally regulated market. The combination positions Organigram with enhanced value capture in Europe’s most advanced medical Cannabis environment, while preserving its Canadian leadership. Successful integration, sustained market growth, and continued regulatory progress in Germany and adjacent jurisdictions will be critical determinants of long-term value creation in an industry increasingly defined by scale, compliance, and strategic footprint.