×
×
×
×
Grow Business

Merger of two Canadian cannabis companies results in largest weed deal in history

De196ec3f58255c8c59ca3af1fb72a51?s=96&d=mm&r=g
Jessica Brown May 14, 2018 10:18 am 633

Aurora Cannabis Inc. and MedReleaf Corp. officially announced that they have entered into a definitive agreement whereby Aurora will acquire all shares in MedReleaf Corp.

The transaction between these two Canadian companies is the largest deal in the cannabis sector to date, valued at C$3.2 billion.

Cannabis conglomerate

In a press release issued earlier today, the companies highlighted “a total funded capacity of over 570,000 kg per year of high-quality cannabis, through nine facilities in Canada and two in Denmark,” and extensive distribution channels in Canada and internationally.

The two companies have established distribution agreements with Alberta’s Alcanna (formerly Liquor Stores), Quebec’s SAQ, Pharmasave, and Shoppers Drug Mart in Canada, among others.

Additionally, the companies have a rapidly growing international footprint through a network of in-country sales and distribution capabilities and supply and licensing agreements on five continents, including countries such as Germany, Italy, Brazil, and Australia.”

A word from the CEOs

“This is a transformational transaction that brings together two pioneering cannabis companies, both committed to high technology, high quality, and low-cost production, to create a powerful platform for accelerated growth and success on a global scale,” said Terry Booth, CEO of Aurora.

Neil Closner, CEO of MedReleaf, added, “by combining with Aurora, an integrated producer with an exceptionally strong track record for execution, and deep domestic and international distribution capabilities, we will be ideally positioned to set the global standard for our industry at a pace that will be difficult to match.”

What this means for investors

Aurora is riding the wave of consolidation in anticipation of legalization this summer. The company entered into a C$1.23 acquisition deal with CanniMed Therapeutics Inc. earlier this year, as well as making a cornerstone investment and purchase order deal with The Green Organic Dutchman.

The Exchange Ratio for Aurora’s latest takeover will give 3.575 common shares of Aurora for each MedReleaf common share held. After the finalization of the merger transaction, “Aurora and MedReleaf shareholders would own approximately 61% and 39% of the pro forma company.”

MedReleaf shares are being valued at a premium of approximately 34%, at a price of C$29.44 per share.

Grow with us on Facebook and Instagram for all your cannabis-related content.

Dh newsletter logo

Get direct access to our top weekly content, contests, and perks.


De196ec3f58255c8c59ca3af1fb72a51?s=96&d=mm&r=g
Jessica Brown
Grow Editor at Daily Hive 🌿❤️️ Lover of knowledge, learner of cannabis. Join me on my journey towards higher education alongside industry experts and leaders. Have a question or story idea about cannabis? Email me: [email protected]

© 2018 Buzz Connected Media Inc.