Medical marijuana plants seen at Aphria's Leamington greenhouses on February 19, 2016. (Photo by Ricardo Veneza)Medical marijuana plants seen at Aphria's Leamington greenhouses on February 19, 2016. (Photo by Ricardo Veneza)
Windsor

Aphria shareholders approve merger with Tilray

An overwhelming majority of Aphria shareholders have said yes to a merger creating the largest producer of cannabis in the world.

Those holding shares of the Leamington cannabis producer voted 99.38 per cent in favour of the merger with Tilray at a special meeting held last Wednesday. A special resolution required two-thirds of shareholders to approve the arrangement.

"The combined company will be increasingly well-positioned to deliver a sustainable, attractive return for our combined shareholder base," said Aphria CEO Irwin D. Simon.

A total of 108,409,367 Aphria shares were represented by proxy at the online meeting. That is over a third of all issued and outstanding shares.

The deal will see Aphria shareholders receive 0.8381 of Tilray for each common share. Aphria stock is worth $14.61, while the value of Tilray's is $17.44.

There will be no adjustment for previous Tilray shareholders.

Aphria's board of directors has already unanimously approved the merger. However, it is still subject to closing conditions, including court approval and the approval of Tilray shareholders in a vote scheduled for April 30.

Two years ago, Aphria held off a hostile takeover bid from Green Growth Brands of Ohio. The board said that offer undervalued the company and expressed concerns the new operation would not be listed on the TSX and NYSE. Shareholders ultimately rejected the bid.

The offer from Tilray came with a positive review from two independent firms, Glass Lewis and Co. LLC and Institutional Shareholders Services Inc.

The merger could save $75-million a year in operating costs.

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