By Ketki Saxena
Investing.com – Cannabis company Tilray (TSX:TLRY) has announced a deal to acquire its rival Canadian cannabis company HEXO corp for $US 250 million.
Under the terms of the Arrangement Agreement, HEXO Shareholders will receive 0.4352 of a share of a Tilray share in exchange for each HEXO Share held. The agreement implies a purchase price of US$1.25 per HEXO Share based on the volume weighted average price of Tilray Shares on the Nasdaq for the 60-day period ended on April 5, 2023.
Warrants and other convertible securities of HEXO will also be adjusted in accordance with terms after adjustments to reflect the Arrangement and account for the Exchange Ratio.
The closing of the deal is subject to a number of conditions including approval of at least 66⅔% of votes cast by the HEXO Shareholders at a special meeting of HEXO Shareholders, expected to take place before June 22, 2023.
Sources report that the company’s biggest shareholders have already signed off on the deal and it is likely to be quickly approved.
If approved at the Meeting, the Arrangement is expected to close shortly thereafter, subject to regulatory approvals, approval of the court and other customary closing conditions.