LEAMINGTON, Ont. — An Ohio-based company is making a hostile bid to acquire one of the biggest players in Canada’s legal cannabis market.
Columbus-based Green Growth Brands Ltd. has announced a takeover bid for Aphria Inc. that values the Leamington, Ont.-based firm at $2.8 billion.
Green Growth says in a statement that the offer values Aphria shares at $11 each, providing shareholders with a 45.5 per cent premium over the company’s closing price on Monday, Dec. 24.
Aphria shares closed Thursday at $7.57 on the Toronto Stock Exchange, but shot up in after-hours trading amid reports of the takeover bid.
An Aphria representative did not immediately respond to a request for comment.
Green Growth CEO Peter Horvath says in a statement that the acquisition “will create value for both Aphria and Green Growth shareholders.
“We are confident that the significant premium we are offering and the opportunity to participate in the growth of a stronger, combined company are so compelling that we are taking our offer directly to Aphria’s shareholders,” Horvath said.
“Together, we can unleash synergies between our teams, assets and geographies, forming a combined enterprise that will accelerate our collective growth strategies in Canada, the U.S. and overseas.”
Earlier this month, a Toronto law firm said it filed a proposed class action against Aphria and its chief executive and financial officers after the company was targeted by short-sellers.
Koskie Minsky LLP alleges Aphria made false and misleading statements related to its acquisition of LATAM Holdings Inc., a claim that has not been tested in court.
The proposed class action came after short-sellers Quintessential Capital Management and Hindenburg Research alleged in early December that Aphria’s acquisition of the LATAM Holding assets in Colombia, Argentina and Jamaica were “largely worthless.”
Aphria said on Dec. 6 that it had set up a special committee of independent directors to review the acquisition.
Companies in this story: (TSX:APHA, CSE:GGB)
The Canadian Press