Photographer: Taylor Weedman / Bloomberg
Photographer: Taylor Weedman / Bloomberg
A new giant formation in the fast-growing cannabis industry will follow Tillere Inc. And Afria Inc. Agreed to merge their operations.
The Il-Stock Deal, which combines two well-known names in the industry, is valued at about 3. will create a new entity with an equity value of billion 1 billion (8 8.8 billion), according to a statement and interview with Tille and Afria’s chief executive. 12-month annual sales of joint ventures surpass $ 874 million for industry leaders Kuralife Holdings Inc. And Canopy Growth Corp.
The new company will trade under Tiller’s ticker on the Nasdaq and Afria shareholders own 62% of Tiller’s stock under the terms of the transaction, which was described as a “reverse acquisition of Tiller”. Afria Tillera will pay a 23% premium of T 7.87 to the December 15 closing price.
Afria’s chief executive officer, Fischer Irwin Simon, will be the chairman and CEO of the joint venture, said Afria’s chief executive, Irvis Simon. The colony is a business with international assets. ‘ Group.
The deal reinforces that cannabis, still seen by some as a fringe investment, is a well-developed sector as U.S. No more states legalize the substance and a growing number of European countries are open. Until Its medical use. The industry has seen a flurry of deals as companies jockey for positions amid rapidly changing rules. The combined assets of Tillere and Afria represent the initial step towards that goal of creating a global cannabis operation.
Photographer: Galit Roden / Bloomberg
Tillere CEO Brendan Kennedy will be a board member of the joint venture. Kennedy and Simon first met in 2018, but financial courtship only began this year. It was done on texts and calls due to the Covid-19L downdown which made meeting face-to-face difficult.
The new company will sell marijuana products in Canada and will be in a better position to ‘advance growth opportunities’ such as medical marijuana in Germany. The companies said Tillere’s Portuguese manufacturing facility would allow tariff-free entry to the European Union.
Simon and Kennedy said the potential U.S. The deal is in a better position to take advantage of federal legalization and is also built on the possibility of making it more legal in Europe. Kennedy said Afria’s two properties in Germany – a distribution center for medical prescriptions and a farming facility – were particularly attractive.
“We Felt With this deal, we can win not only in Canada, but also in Europe. ”
Beverage Assets
A mix of beverage properties will also result. There is Afria U.S. Craft beer company Sweetwater Brewing Company, which makes marijuana-based beverages, and Tiller agreed to an acquisition Partner of Anhuzer-Bush Inbayev. U.S. The joint operation will focus on Sweetwater and Manitoba Harvest, which makes branded linen and CBD products.
Simone said Canada is interested in making the pH of aphrodisiacs using the Tillere drink facility, which contains TH CB, the active ingredient in cannabis.
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The joint venture is expected to have strong, flexible balance sheets, cash balances and access to capital that would enable it to accelerate growth and deliver attractive returns to shareholders, the joint statement said.
The companies say the tie-up, which requires shareholder approval from Tiller, will reduce annual pre-tax costs by about 100 100 within 24 months of its completion. The agreement, which is expected to close in the second quarter of 2021, includes the right to match bids and in some cases a mutual termination fee of C $ 65 million.
BNN Bloomberg Television Earlier it was reported that Afria and Tiller are holding advanced talks. Shares of both companies rebounded in late trading on Tuesday, with Tiller rising 26% to 9.94 and Afria 23% to $ 9.96. As of Tuesday, shares of Tillere have fallen 54% in 2020, while shares of Afria have risen 56%.
‘Extended Reach’
Bloomberg Intelligence analysts Ken Shi and Gopal Srinivasan a The research notes that the combination will provide several benefits “including expanded access to international medical cannabis markets”.
According to cannabis consulting firm Brightfield Group, the European market will grow by 25% from 2019 to $ 359 million in 2020. However, the US is the biggest prize. According to Euromonitor International, by its widespread entertainment use, it will represent 70 percent of the world’s 93.8 billion market by 2025.
Jefferies served as the financier of Africa Advisor, And was by Cowan Tillere Advisor.
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