Look out, Canopy Growth Corporation. Your reign as the pure-play marijuana stock with the highest market cap might not last for long.
On Tuesday, Aurora Cannabis announced that it had submitted a proposal to acquire all shares of another Canadian marijuana grower, CanniMed Therapeutics. Aurora is offering to buy CanniMed, which trades on the Toronto Stock Exchange, for $24 per share. If the deal goes through, Aurora thinks the combined companies would likely claim a market cap of more than $3 billion, potentially bumping Canopy Growth from its perch as the largest pure-play marijuana stock on the market.
A merger of Aurora and Cannimed wouldn’t just affect those two companies, though. It could have ripple impacts throughout the cannabis industry — in Canada and across the world.
What will the combination of Aurora Cannabis and CanniMed Therapeutics look like? The resulting company will have over 40,000 active registered medical cannabis patients in Canada. The deal would also plug CanniMed’s customers into Aurora’s e-commerce platform, which allows Canadian patients to purchase medical cannabis online.
More important, though, the acquisition of CanniMed would give Aurora significant added capacity. The combined company would have five cultivation facilities, with more on the way. Altogether, this would enable annual production of 130,000 kilograms of cannabis. [Read more at Business Insider]
Source: Cannabis Business Executive