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Controversial Canopy Growth Founder Eyes Investment In Pornhub

Canadian cannabis investment veteran Chuck Rifici is understood to be leading an investor group to buying major pornographic media platform, Pornhub.  Rifici co-founded one of the world’s largest cannabis companies, Canopy Growth, and was subsequently booted out after a boardroom battle. He was also former chief financial officer of Canada’s Liberal Party.

Business Insider reported on 7 May 2021 that Rifici was in discussion with Pornhub owner, Mindgeek, to acquire its shares in the pornography company. 

 

Rifici: the Godfather of Canadian cannabis diversifying into porn

 

Rifici is currently CEO of Nesta Holding Co., a private equity firm that invests in the cannabis industry. In 2013 he and Bruce Linton founded Tweed Marijuana Inc, raised US$24 million from investors, acquired a large manufacturing plant in Smiths Falls, and got listed on the TSX Venture Exchange. Rifici took Tweed public on 4 April 2014, becoming the Canada’s biggest full-scale producer of government-sanctioned cannabis Canadian government. Tweed was subsequently renamed Canopy Growth and Rifici remained its largest shareholder despite a series of boardroom showdowns that led to him being fired and a various litigatious proceedings.

 

 

 pornhub investment pornhub inveswtmentCanopy Growth was one of the first international cannabis companies to invest in Lesotho in 2017 and then in South Africa, where it had plans for major cultivation operations. However, it exited all its African operations in 2019 after a change in shareholders led to a radical change in in strategic direction.

 

The Report below is from Business Insider 7 May 2021

Pornhub has been in acquisition talks with an investor group led by a Canadian cannabis entrepreneur and former Liberal Party official, according to two knowledgeable sources.

Chuck Rifici, a since-ousted cofounder of Canadian cannabis giant Canopy Growth and the former CFO of the Liberal Party of Canada, has in recent weeks discussed purchasing assets including Pornhub with owner MindGeek, according to the sources.

The price, other potential investors, or whether Rifici has raised money to do a deal, remain unclear. According to a Financial Times report, MindGeek brought in more than $460 million in revenue in 2018. 

“I’m always looking at different deals and my team at [investment firm] Bruinen is exploring a number of opportunities, but until there is something to announce progress on, I have no further comment,” Rifici said in an email to Insider.

MindGeek declined to comment. Emails to three top executives were not returned.

Montreal-based Pornhub is facing lawsuits from sex trafficking survivors and scrutiny from Canadian and US lawmakers for allegedly failing to police child pornography, sexual assault content, and videos posted without the consent of those depicted on its platform.

In March, a bipartisan group of 70 Canadian lawmakers called for a criminal investigation.

The legal and regulatory fallout was first sparked by a December New York Times column by Nicholas Kristof that prompted major credit card companies to cut ties with Pornhub.

The company denied that it allowed child pornography on its platform but also made sweeping changes, permitting only verified users to upload content and promising to improve content moderation.

Pornhub said in a February statement: “Pornhub is working to implement changes in the following areas: content standards, content uploading and review processes, content removal and user exclusion, partnerships, relationships with law enforcement and NGOs, and wellness and harm reduction.”

The legal scrutiny has made MindGeek an acquisition target in recent months, according to the sources. MindGeek owns other porn sites including RedTube and YouPorn. Its current ownership structure is difficult to discern — commonplace in the labyrinthine world of internet pornography.

Conservative Member of Parliament Arnold Viersen told Insider that the pressure on Pornhub in Canada is unlikely to let up even if the company changes hands. “I’m skeptical of a culture change,” Viersen said.

Rifici has a long and tumultuous history in the Canadian cannabis industry, another heavily regulated sector.

Rifici, along with Bruce Linton, founded Tweed Cannabis — which later became the NYSE-listed Canopy Growth — before he was ousted by the board in 2014. Rifici sued Canopy Growth for wrongful dismissal and the company countersued, though both suits have since been dismissed.

In 2017, Rifici sued three Members of Parliament from Canada’s Conservative Party for defamation over what he said were allegations the MPs made that Rifici had profited from insider trading after Canopy Growth’s stock skyrocketed.

Rifici then founded Nesta Holding Co., a firm that invests in the cannabis industry, and founded and served as the CEO then chairman of Auxly Cannabis Group before resigning in 2020. He sits on the board of vaporizer company Feather as well as psychedelic medicine company Novamind and serves as the executive chairman of Bruinen Investments, per his LinkedIn page

MindGeek has been the subject of other news coverage lately. Insider previously reported that there was no evidence to support the existence of some Pornhub executives that had been quoted in news articles. And last month, MindGeek CEO Feras Antoon’s $20 million Montreal mansion went up in flames in a suspected arson attack.

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