Leamington cannabis producer Aphria is telling its investors to reject a hostile takeover bid from an Ohio-based company.
A notice on the company's webpage recommends shareholders reject the bid by Green Growth Brands.
The board of directors suggests shareholders "do not tender their shares". It rejected the bid unanimously.
In the posting, Aphria lists a number of concerns about the bid including a statement that it undervalues the company's current and future value "offering Aphria shareholders a significant discount as opposed to a premium in line with other recent takeover transactions in the cannabis sector."
It also says the combined company would be prohibited from listing on TSX and NYSE, and there are concerns about engaging in "federally illegal activities in the U.S."
A successful takeover would give Green Growth Brand shareholders a 36 per cent interest in Aphria, along with control of the company's management and board of directors.
The bid is open until 5 p.m. May 9, 2019. Aphria shareholders are advised to take no action, and if they have already tendered shares, they can withdraw.
This is not the first time Aphria has told its shareholders the takeover bid was not in their interest. Days after receiving the bid, it said the offer fell short of offering shareholders a reward for taking part in the transaction.