The world’s largest cannabis company has bought British beauty brand This Works for £43m in a deal that will see it launch a range of products infused with the cannabis ingredient CBD to help users sleep and improve their skin.

Canopy Growth, a Canadian firm which sells both medicinal and recreational cannabis products paid cash for the company, founded by former Vogue journalist Kathy Phillips and owned by private equity group Tengram Capital Partners.

This Works chief executive, Dr Anna Persaud, will remain in charge after the takeover and will oversee the launch of a range of products containing cannabidiol.

The ingredient, known as CBD, does not induce a high but has ridden the wave of a global trend for “wellness” products that contain it.

Persaud said: “As a leading wellness brand and a pioneer in sleep beauty products, we are passionate about the opportunity CBD offers beauty consumers.

“Canopy Growth will provide the expertise, research, scientific rigour and quality assurance that will allow This Works to drive the agenda in wellness beauty’s ever-evolving market.”

London-based This Works is one of a breed of fast-growing beauty firms to have capitalised on social media and online sales to build a customer base rapidly, challenging well-established players.

Its best known products include a deep sleep pillow spray, intended to help induce sleep, and its skin deep dry leg oil.

Canopy was founded six years ago but has built up a stock market value of $16bn thanks to the deregulation and legalisation of cannabis in North America.

It has also signed lucrative partnerships with celebrities such as celebrity TV chef Martha Stewart, who promotes its medicinal products and rapper Snoop Dogg, who advertises its recreational range.

Canopy is expected to use its financial muscle to help This Works expand its international customer base.

Bruce Linton, chairman and co-chief executive of Canopy Growth said CBD products had the potential to “disrupt the cosmetic and sleep solution industries”.

The deal will also expand Canopy’s presence in the UK, where it already has a joint venture called Spectrum Biomedical, which is focused on producing medicinal cannabis products for patients in the UK.

The cannabis industry has undergone an explosion of growth in the US and Canada thanks to relaxation of the laws governing both recreational and medicinal use.

The European cannabis market will be worth €123bn (£106bn) by 2028, according to the London-based analysis firm Prohibition Partners.