Covid-19 related lockdowns have presented unique challenges across Canadian and German markets, Simon said in a statement. ahead-of-print No. Cannabis does look like a secular growth market. Consider that the price went from $5.50 to $20. Stock Market Basics. Tilrays new leadership team and board of directors will provide a strong foundation for the Company to accelerate growth and capitalize on the business combinations many benefits. Tilray generated free cash flow of $3.3 million, compared to a cash burn of $28.3 million a year earlier. So, it does seem that eventually there will be the same on the federal level in the coming years. Aphria ()() shareholders have voted in favour of the reverse acquisition of rival Canadian pot producer Tilray ().The decision helps pave the way for the blockbuster deal announced in December to form the world's largest pot company by revenue. Aphria and Tilray executives will host a conference call and webcast with a supplemental presentation to discuss the strategic business combination today, December 16, 2020 at 8:30 a.m. Eastern Time. ahead-of-print. www.cannabisbusinesstimes.com is using a security service for protection against online attacks. Tilray shareholders voted in favor of the deal on Friday. Analyst Report: Tilray Brands, Inc.Tilray is a Canadian producer that cultivates and sells medical and recreational cannabis. Husch Blackwell LLP. 203-682-8253 The forward-looking statements included in this news release are made as of the date of this news release and neither Aphria nor Tilray undertake any obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities laws. Likewise, the stock market heavily disfavors marijuana companies and unprofitable companies at the moment, and Tilray falls into both of those buckets. In a press release, Tilray said that the combined entity had proforma revenue of $685 million in the last year. Stock Market 101 ; Types of Stocks ; Stock Market Sectors ; Premium Services Third Quarter Performance. Aphria and Tilray use words such as forecast, future, should, could, enable, potential, contemplate, believe, anticipate, estimate, plan, expect, intend, may, project, will, would and the negative of these terms or similar expressions to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Focusing on maximizing revenue and growth in the profitable core business. The challenge of coordinating previously independent businesses makes evaluating the business and future financial prospects of the Company following the business combination difficult. The Motley Fool has a disclosure policy. Tilray (NASDAQ: TLRY) shareholders will vote on the all-stock merger with Aphria (NASDAQ . Kind of amazing that they can write off $1.1B in the quarter ("market cap reduction", is that the new way of saying we wrote off the terrible buys we did?) Upon the completion of the Arrangement, Aphria Shareholders will own approximately 62 percent of the outstanding Tilray Shares on a fully diluted basis, resulting in a reverse acquisition of Tilray, representing a premium of 23 percent based on the share price at market close on December 15, 2020 to Tilray shareholders. Tilray shares gained 1.61 per cent to $17.69 at 11:44 a.m. As these markets begin to re-open, Tilray is poised to strike and transform the industry with our highly scalable operational footprint, a curated portfolio of diverse medical and adult-use cannabis brands and products, a multi-continent distribution network, and a robust capital structure to fund our global expansion strategy and deliver sustained profitability and long-term value for our stakeholders., Mr. Simon continued, Our global team is laser-focused on turning potential into performance and addressing consumer and patient needs for safe, innovative, and high-quality products. This news release is not intended to and does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy or an invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. While it could still become the most important marijuana business internationally in due time, reaching that goal is a plan that's in progress at the moment. This actually presents an arbitrage opportunity, in which an investor can short Tilray and buy Aphria to lock in a gain. However, as seen in the last election, more states are moving towards legalization. However, the company lowered the quorum requirement for the shareholder meeting and it was eventually approved overwhelmingly towards the end of April. The estimate is that they could hit about $78 million within the next couple years. Well, I think the deal will be transformative for APHA stock and has the potential to lead to strong long-term gains. All Rights Reserved. LEAMINGTON, Ontario & NANAIMO, British Columbia--(BUSINESS WIRE)--Dec. 16, 2020-- Aphria Inc. (Aphria) (TSX: APHA and Nasdaq: APHA), a leading global cannabis company inspiring and empowering the worldwide community to live their very best life, and Tilray, Inc. (Tilray) (Nasdaq: TLRY), a global pioneer in cannabis research, cultivation, production and distribution, today announced that they have entered into a definitive agreement (the Agreement) to combine their businesses and create the worlds largest global cannabis company (the Combined Company) based on pro forma revenue1. In the event of federal permissibility, the Company expects to be well-positioned to compete in the U.S. cannabis market given its existing strong brands and distribution system in addition to its track record of growth in consumer-packaged goods and cannabis products. For a more detailed discussion of risks and other factors, see the most recently filed annual information form of Aphria and the annual report filed on form 10-K of Tilray made with applicable securities regulatory authorities and available on SEDAR and EDGAR. Upon completion of the Arrangement, Aphrias current Chairman and Chief Executive Officer, Irwin D. Simon, will lead the Combined Company as Chairman and Chief Executive Officer. For more information on how we open a world of wellbeing, visit Tilray.com. Cannabis stocks have been on a fire over the last few trading sessions amid renewed hopes of marijuana legalization. Tilray (TLRY) and Aphria (APHA) both do something with cannabis. Tilray's stock has lost some 36% of value in the last three years. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. Assuming regulators agree to the deal, Tilray will have its work cut out after it closes its bolt-on acquisition. Copies of these documents may be obtained, free of charge, from the SEC or Tilray as described in the preceding paragraph. But the opportunity in the U.S. could easily boost these numbers. This was the case when Salesforce acquired Slack. May 3, 2021 at 8:46 am. The challenge of coordinating previously independent businesses makes evaluating the business and future financial prospects of the Combined Company following the Arrangement difficult. This includes leveraging Aphria and Tilrays proven distribution networks in Canada to sell SweetWaters 420 cannabis lifestyle brand in Canada. 3 Stocks That Are Poised to Plunge. This includes gross revenue of $232 million from the sales of adult-use marijuana. Market Realist is a registered trademark. However, shares have a weak 26 . Approval of a majority of the votes cast by Tilray stockholders will be required to, among other things contemplated by the Agreement, authorize the issuance of Tilray shares to Aphria shareholders pursuant to the Arrangement. The Combined Company is considering utilizing Tilrays existing Nanaimo, British Columbia facility for Aphrias premium Broken Coast brand to increasingly meet consumer demand for its products. Now that the Aphria/Tilray merger has been announced, we can expect other top-tier Canadian pot stocks, like Canopy Growth Corp (NASDAQ:CGC) and Aurora Cannabis Inc (NYSE:ACB), to begin to see . In addition, the Combined Company will have a complete breadth of products in every major cannabis category, including flower, pre-roll, oils, capsules, vapes, edibles and beverages. There will also be significant cost reductions. However, there was an arbitrage opportunity before the merger. Aphria (APHA) and Tilray (NASDAQ:TLRY) are merging.Combined, the two companies are likely to save money - the main focus of the press releases - but it will take some time until those savings . Tilray's management and advisers briefed the company's board on Feb. 21 about recent discussions with Aphria, as well as combinations with other potential merger partners or acquisition targets. On April 10, Tilray Brands (TLRY -0.20%) advanced the consolidation of the marijuana industry one step further when it announced that it was acquiring Hexo, an underperforming Canadian cannabis operator. To make the world smarter, happier, and richer. Low-cost, State-of-the-Art Production & the Leading Canadian Adult-Use Cannabis Producer. Many factors could cause actual results, performance or achievement to be materially different from any future forward-looking statements. Cowen served as financial advisor, and Cooley LLP and Blake, Cassels, and Graydon LLP acted as legal counsel to Tilray. https . The Agreement includes certain reciprocal customary provisions, including covenants in respect of the non-solicitation of alternative transactions, a right to match superior proposals and C$65million (US$50 million) reciprocal termination fee payable under certain circumstances. Tom Taulli (@ttaulli) is the author of various books on investing and technology, including Artificial Intelligence Basics, High-Profit IPO Strategies and All About Short Selling. Tilray stock has fallen sharply from the peaks. Your support ID is: 3409538128455382982. The service requires full JavaScript support in order to view this website. The Company expects to deliver approximately US$81 million (C$100 million) of annual pre-tax cost synergies within eighteen months and plans to achieve cost synergies in the key areas of cultivation and production, cannabis and product purchasing, sales, and marketing, and corporate expenses. Any information or statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements, including, but not limited to, statements in this news release with regards to: (i) statements relating to Aphrias and Tilrays strategic business combination and the expected terms, timing and closing of the Arrangement including, receipt of required regulatory approvals, shareholder approvals, court approvals and satisfaction of other closing customary conditions; (ii) estimates of pro-forma financial information of the Combined Company, including in respect of expected revenues and production of cannabis; (iii) estimates of future costs applicable to sales; (iv) estimates of future capital expenditures; (v) estimates of future cost reductions, synergies including pre-tax synergies, savings and efficiencies; (vi) statements that the Combined Company anticipates to have scalable medical and adult-use cannabis platforms expected to strengthen the leadership position in Canada, United States and internationally; (vii) statements that the Combined Company is expected to offer a diversified and branded product offering and distribution footprint, world-class cultivation, processing and manufacturing facilities; (viii) statements in respect of operational efficiencies expected to be generated as a result of the Arrangement in the amount of more than C$100 million of pre-tax annual cost synergies; (ix) expectations of future balance sheet strength and future equity; (x) that the Combined Company is expected to unlock significant shareholder value; and (xi) statements under the heading Strategic and Financial Benefits of this news release. In an all-stock deal agreed to last . TLRY, As previously announced, each Aphria shareholder received 0.8381 of a Tilray Share for each Aphria common share (each an Aphria Share) held on April 30, 2021, the effective time of the transaction. Tilrays London, Ontario facility will also provide Aphria with excess capacity to increase production of additional form factors including their branded edibles and beverages. The Combined Company will be led by a best-in-class management team and board of directors, with strong track records in consumer-packaged goods and cannabis experience internationally. For more information, visit: aphriainc.com. We believe that the Company has the strategic footprint and operational scale necessary to compete more effectively in todays consolidating cannabis market with a strong, flexible balance sheet, strong cash balance, and access to capital, which we believe will give the Company the ability to accelerate growth and deliver long-term sustainable value for stockholders. Each of Aphrias and Tilrays respective directors and officers and certain principal Tilray Stockholders have entered into voting support agreements agreeing to vote their Aphria Shares or Tilray Shares, as applicable, in favor of the resolutions put before them pursuant to the Agreement. In 2021, legacy Aphria acquired legacy Tilray in a reverse merger and . First, the terms of the deal will mean that their shares get a bit diluted. In other words, management's track record with retaining the market share it gains via acquisitions is spotty at best, and its long-term goal of reaching a market share of around 30% seems persistently far off. Navigating the tides of an emerging global cannabis industry: the Aphria-Tilray merger decision The CASE Journal 18 maart 2022 Eghbali-Zarch, M., Marlowe, J. and Brennan, S. (2022), "Navigating the tides of an emerging global cannabis industry: the Aphria-Tilray merger decision", The CASE Journal, Vol. On May 3, 2021, the merger between Tilray Inc. and Aphria Inc. marked a new era of growth by creating the largest cannabis company in the world in terms of revenue and geographic reach. Information regarding the persons who may, under SEC rules, be deemed participants in the solicitation of proxies to Tilray stockholders in connection with the proposed transaction will be set forth in the Tilray proxy statement for the proposed transaction when available. The new entity will be the clear leader in the Canada market, which has continued to see strong growth. The Combined Company plans to capitalize on opportunities for growth through a broadened product offering and additional form factors, with the aim of increasing adult-use cannabis brand availability across certain Canadian provinces to an expanded customer base with the Combined Companys scalable infrastructure. However, it looks a good buy now given the strong fundamentals of the new entity. Other information regarding the participants in the Tilray proxy solicitation and a description of their direct and indirect interests in the proposed transaction, by security holdings or otherwise, will be contained in such proxy statement and other relevant materials to be filed with the SEC in connection with the proposed transaction. Alex Carchidi has no position in any of the stocks mentioned. For further information on the terms and conditions of the Arrangement, please refer to the Agreement in its entirety, which will be available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. Unfortunately, it's likely going to be stymied on both those fronts by the sorry state of the Canadian cannabis market, which is flooded with cheap marijuana that's putting a crimp on margins. Factors that may cause such differences include, but are not limited to, risks assumptions and expectations described in Aphrias and Tilrays critical accounting policies and estimates; the adoption and impact of certain accounting pronouncements; Aphrias and Tilrays future financial and operating performance; the competitive and business strategies of Aphria and Tilray ; the intention to grow the business, operations and potential activities of Aphria and Tilray; the ability of Aphria and Tilray to complete the Arrangement; Aphrias and Tilrays ability to provide a return on investment; Aphrias and Tilrays ability to maintain a strong financial position and manage costs, the ability of Aphria and Tilray to maximize the utilization of their existing assets and investments and that the completion of the Arrangement is subject to the satisfaction or waiver of a number of conditions as set forth in the Arrangement Agreement. Raphael.Gross@icrinc.com, Internet Explorer presents a security risk. And Tilray needs to beef up its margins, not grow its collection of value brands from two to five. The Company's portfolio of brands is grounded in expertly researched consumer insights designed to meet the needs of every consumer segment. The Tilray/Aphria merger must be at risk of falling apart. www.cannabisbusinesstimes.com is using a security service for protection against online attacks. Irwin D Simon, formerly Aphrias CEO and chairman, will lead the new Tilray, with Tilrays current CEO Brendan Kennedy joining the board. The merger was announced on December 16, 2020 and I assume they're still looking to merge as the deal makes a lot of sense in terms of market share and cost synergies. Material risks that could cause actual results to differ from forward-looking statements also include the inherent uncertainty associated with the financial and other projections; the prompt and effective integration of the Combined Company; the ability to achieve the anticipated synergies and value-creation contemplated by the proposed transaction; the risk associated with Aphrias and Tilrays ability to obtain the approval of the proposed transaction by their shareholders required to consummate the proposed transaction and the timing of the closing of the proposed transaction, including the risk that the conditions to the transaction are not satisfied on a timely basis or at all; the risk that a consent or authorization that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated; the outcome of any legal proceedings that may be instituted against the parties and others related to the Arrangement Agreement; unanticipated difficulties or expenditures relating to the transaction, the response of business partners and retention as a result of the announcement and pendency of the transaction; risks relating to the value of Tilrays common stock to be issued in connection with the transaction; the impact of competitive responses to the announcement of the transaction; and the diversion of management time on transaction-related issues. On a pro forma basis, for the period August to October 2020, the Combined Company would have held a 17.3% retail market share4, the largest share held by any single Licensed Producer in Canada and 700 basis points higher than the next closest competitor. ET on Thursday. Tilray just purchased another Canadian marijuana business. Tilray Inc. is a leading global cannabis-lifestyle and consumer packaged goods company with operations in Canada, the United States, Europe, Australia, and Latin America that is changing people's lives for the better one person at a time by inspiring and empowering the worldwide community to live their very best life by providing them with products that meet the needs of their mind, body, and soul and invoke a sense of wellbeing. 1 Based on the most recently reported quarterly financial statements for Aphria and Tilray.2 Non-GAAP measure which may not be consistent between companies in our industry. quotes delayed at least 15 minutes, all others at least 20 minutes. Of course, the timing of this rally coincides with the presidential election. To this end, Aphria has its SweetWater Brewing segment, which is a craft beer manufacturer and distributor. Please enable JavaScript on your browser and try again. After the merger completion, the new entity trades under Tilrays ticker symbol, TLRY on both the US and Canadian stock exchanges. In 2021, legacy Aphria acquired legacy Tilray in a reverse merger and renamed itself Tilray. In Germany, Aphrias wholly-owned subsidiary, CC Pharma GmbH, will provide the Combined Company with distribution capabilities for the Aphria and Tilray medical cannabis brands to more than 13,000 pharmacies. According to research from BDSA, the spending is expected to hit a hefty $55.9 billion by 2026. On Dec. 16, 2020, Aphria (APHA) and Tilray (TLRY) announced a merger that has created the worlds largest cannabis company. As for Tilray, it has a strong business in Portugal. In Canada, the combination of Aphria and Tilray will create the leading adult-use cannabis company with gross revenue of C$296 million (US$232 million) in the adult-use market for the twelve months reported by each company. The Merger Deal: Under the deal, each Aphria shareholder received 0.8381 of a Tilray share for each Aphria common share held on April 30. Husch Blackwell LLP ' is very knowledge in the world of cannabis ' and handles cannabis and industrial hemp regulatory matters across all 50 states and Washington DC. , which was one of the first platforms for public offerings during the 1990s. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. We are eager to get to work and want to thank both the Aphria and the Tilray Boards of Directors and especially Brendan Kennedy for his spirit of partnership and irrepressible belief in the art of whats possible. We will benefit enormously from his legacy and continued service on the Tilray Board.. Under the terms of the Arrangement, the shareholders of Aphria (the Aphria Shareholders) will receive 0.8381 shares (the Exchange Ratio)of Tilray for each Aphria common share (each, an Aphria Share), while holders of Tilray shares (the Tilray Stockholders) will continue to hold their Tilray shares (the Tilray Shares) with no adjustment to their holdings. Recreational marijuana sales are expected to soar if marijuana is legalized at the federal level in the U.S., a real possibility now that Democrats control the Senate. Tilray is a pioneer navigating toward the end of prohibition and built to deliver on the collective wellbeing of the Companys employees, consumers, patients, partners, and local communities. +0.71% The merger has already been completed after some delay, and Aphria shares had a name change. On a pro forma basis for the last twelve months reported by each company, the Combined Company would have had revenue of C$874 million (US$685 million). Tilray will acquire Hexo by paying US$56 million in an all-stock deal to acquire the remaining outstanding shares it doesn't own after it will exercise the US$173 million . Whats more, the recreational business will have a strong set of brands, which span from low-cost to premium offerings. ET. Our focus now turns to execution on our highest return priorities including business integration and accelerating our global growth strategy. Electric-vehicle tax credit: See which EVs qualify on updated list, She's a self-taught real estate investor turned millionaire, If King Dollar is wobbling, this asset is your best investment, says Citi, Mark Zuckerbergs total 2022 pay rose because of the increased use of private aircraft. There is a risk that some or all the expected benefits of the Arrangement may fail to materialize or may not occur within the time periods anticipated by Aphria and Tilray. Readers are cautioned that the foregoing list of factors is not exhaustive. Buy basically every single weed play you can. The bulk of . THCX, For instance, Aphria stock was trading around 0.4115 times Tilray on Feb. 10less than half of what it should be trading at based on the merger terms. He is also the founder of. Aphria will also have seven directors and Tilray will have two. To listen to the live call, dial (647) 427-7450 from Canada and the U.S. or (888) 231-8191 from international locations and use the passcode 4334816. Investor Relationsinvestors@aphria.com, Tilray contacts: Media Amy Bonwick, 647-515-3748amy@pomppr.com, Investors Raphael Gross The record date for determining the Aphria Shareholders and the Tilray Stockholders entitled to receive notice of and vote at the Aphria Meeting and the Tilray Meeting, respectively, was . On December 16, 2020, Tilray (TLRY) and Aphria (APHA) announced a merger that would create the largest marijuana company globally. What will this mean? 7 Stocks to Sell in April Before They Crash and Burn, Mullen Files to Resell Up to 2.1 Billion Shares of MULN Stock, 7 Dividend Stocks to Buy That Are Backed by Strong Cash Flows, 3 Reasons Why the Aphria-Tilray Merger Will Be a Winner. In Portugal, Tilrays EU-GMP cultivation and production facility will provide the Combined Company with the capacity to cultivate and produce medical cannabis products in order to meet international demand and has export capabilities, which provides tariff-free access to the EU. This is an exciting day for both companies including our 2,500 employees, for the cannabis industry, and for patients and consumers around the world. The service requires full cookie support in order to view this website. 2023 InvestorPlace Media, LLC. The purchase will shore up its share of the Canadian market, which is sagging. Management claims that there should be around $25 million in annual cost synergies to realize after the purchase is complete, but it's unclear how long that will take to occur. Complementary, Scalable Medical and Adult-Use Cannabis Businesses Strengthen Leadership Position in Canada; Expands U.S. and International Reachthrough World-Class Cultivation, Manufacturing, Diversified Product Portfolio and Distribution Footprint, Robust Supply Chain and Operational Efficiencies Expected to Generate Approximately C$100 Million of Pre-Tax Annual Cost Synergies, Aphria and Tilray to Host a Conference Call and Webcast at 8:30 a.m. Eastern Time. Aphria Inc. is a leading global cannabis company inspiring and empowering the worldwide community to live their very best life.