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Alert Sent 2018-12-04 10:21:30 AM ET

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EQUITY ALERT: Rosen Law Firm Announces Investigation of Securities Claims Against Aphria Inc. - APHA

2018-12-04 10:20:00 AM ET (BusinessWire)


Rosen Law Firm, a global investor rights law firm, announces it is 
      investigating potential securities claims on behalf of shareholders of 
      Aphria Inc. (NYSE: APHA) resulting from allegations that Aphria may have 
      issued materially misleading business information to the investing 
      public.


On December 3, 2018, Quintessential Capital Management and Hindenburg 
      Research issued a report claiming that "Aphria is part of a scheme 
      orchestrated by a network of insiders to divert funds away from 
      shareholders into their own pockets" involving the acquisition of shell 
      companies at artificially inflated prices. On this news, Aphria's stock 
      fell $1.85 per share or approximately 23% to close at $6.05 per share on 
      December 3, 2018. Aphria's stock has continued to fall sharply on 
      December 4, 2018.


Rosen Law Firm is preparing a class action lawsuit to recover losses 
      suffered by Aphria investors. If you purchased shares of Aphria please 
      visit the firm's website at https://www.rosenlegal.com/cases-1464.html 
      to join the class action. You may also contact Phillip Kim or Zachary 
      Halper of Rosen Law Firm toll free at 866-767-3653 or via email at pkim@rosenlegal.com 
      or zhalper@rosenlegal.com.


Follow us for updates on LinkedIn: https://www.linkedin.com/company/the-rosen-law-firm 
      or on Twitter: https://twitter.com/rosen_firm 
      or on Facebook: https://www.facebook.com/rosenlawfirm.


Rosen Law Firm represents investors throughout the globe, concentrating 
      its practice in securities class actions and shareholder derivative 
      litigation. Rosen Law Firm was Ranked No. 1 by ISS Securities Class 
      Action Services for number of securities class action settlements in 
      2017. The firm has been ranked in the top 3 each year since 2013.


Attorney Advertising. Prior results do not guarantee a similar outcome.


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View source version on businesswire.com: https://www.businesswire.com/news/home/20181204005722/en/


SOURCE: The Rosen Law Firm, P.A.


Laurence Rosen, Esq.Phillip Kim, Esq.Zachary Halper, Esq.The Rosen Law Firm, P.A.275 Madison Avenue, 34th FloorNew York, NY 10016Tel: (212) 686-1060Toll Free: (866) 767-3653Fax: (212) 202-3827lrosen@rosenlegal.compkim@rosenlegal.comzhalper@rosenlegal.comwww.rosenlegal.com

Aphria Unequivocally Stands Behind its LATAM Operations

PR Newswire

LEAMINGTON, ON, Dec. 4, 2018

• Assets Well Positioned to Create Substantial Value for Shareholders
• Executive Management Demonstrates Belief in Company Through $3.1M Acquisition of Shares on December 3, 2018

LEAMINGTON, ON, Dec. 4, 2018 /PRNewswire/ - Aphria Inc. ("Aphria" or the "Company") (TSX: APHA and NYSE: APHA) today provides the following update on its Latin American operations, including its previously completed LATAM acquisition of LATAM Holdings Inc. consisting of licenses and other assets and related businesses in Colombia, Argentina and Jamaica and a right of first offer and refusal in respect of Brazil(collectively, the "Transaction"), which closed on September 27, 2018.

Vic Neufeld, Aphria's Chief Executive Officer, said, "Since closing this important strategic acquisition in September, we have made considerable progress supporting and building out our operations on the ground in Latin America and the Caribbean. .

We have nearly 100 employees across the region dedicated to advancing the Company's business interests, including cultivation, processing, research and development, partnerships and continued expansion. International operations are a core component to our proven growth strategy and we are working to integrate and enhance operations and product channels throughout Latin America to position them for sustainable, long-term shareholder value creation."

Background: LATAM Holdings Acquisition
Aphria is committed to good corporate governance and transparency.  The LATAM acquisition was a transaction negotiated at arms' length between two publicly traded companies each of which retained professional financial advisors (one of which provided a formal valuation of the acquired assets).  Aphria and SOL Global Investments Corp. (formerly Scythian Biosciences Corp.) ("SOL") are not "sister" companies and were not "sister" companies at the time the Transaction was agreed to between the parties.
In connection with the Transaction, the Company notes, among other things, the following:

• The Board of Directors of Aphria received financial advice and a fairness opinion from Cormark Securities Inc., the Company's independent and qualified financial advisor, that the consideration to be offered by Aphria in respect of the transaction was fair, from a financial point of view, to Aphria.
• The Company believes that the purchase price paid under the Transaction was comparable with similar Latin America acquisitions by other large cap, Canadian licensed producers.
• The Transaction resulted in minimal dilution to Aphria shareholders (6.6% basic / 6.3% fully diluted). 
• The Company retained leading transaction counsel in each jurisdiction who completed extensive legal due diligence on the assets, licenses and businesses in each jurisdiction.
• Representatives of Aphria travelled to Colombia, Argentina, Jamaica and Brazil to conduct due diligence regarding the assets to be acquired which included management meetings, site visits by senior management in each country and meetings with local authorized representatives.
• The Company entered into a negotiated share purchase agreement with SOL in connection with the Transaction which contained extensive representations, warranties, covenants, conditions and indemnities which survived the closing of the Transaction.     
• In its press release announcing the transaction, the Company transparently disclosed that certain insiders of Aphria owned a de minimis amount of shares and warrants of SOL and that such insiders had disclosed such interests to the Board of Directors and recused themselves from the deliberations during which the Transaction was discussed and from voting on the resolution approving the Transaction.

Since the completion of the Transaction, the Company has successfully integrated the operations in each jurisdiction, and provides the following updates:
Colombia

• Aphria owns a 90% interest in Colcanna S.A.S. ("Colcanna"). Colcanna has received all required licenses for cultivation, processing, export, research and commercialization.
• Colcanna sits on 34 acres of highly fertile, predominately flat land, which is essential for the optimal cultivation of cannabis, including the greenhouse which sits on the acreage that recently housed mother plants.
• The Company has recently signed a Promissory Letter for the purchase of the additional 8 hectares of land immediately adjacent to existing property for expansion.
• Colcanna is licensed to cultivate psychoactive and non-psychoactive cannabis. The licenses held by Colcanna also permit cultivation, export, research and processing.
• Colcanna was also granted by the Colombian Agricultural Institute, on October 30, 2018 a characterization permit pursuant to Resolution No. 35244 and No. 35245 allowing the company to assess seeds and initiated a pilot test of its strains prior to full scale cultivation.
• Greenhouses are planned for more than 20 acres of the property, with 6 harvests expected per year.
• Colcanna is expected to achieve an initial annualized production of 30,000 kg, growing to up to 50,000 kgs, suitable for supplying the country and the region with high-quality medical cannabis.
• There are 48 employees in Columbia, dedicated to cultivation and advancing business interests.

Jamaica

• Marigold is fully operational with:
• An issued Tier 3 license to cultivate more than five acres of land with cannabis for medical, scientific and therapeutic purposes;
• An issued Research and Development License;
• A conditional Tier 2 license to process cannabis for medical, scientific and therapeutic purposes, including the manufacturing of cannabis-based products, in a space of over 200 square meters;
• A conditional herb house retail license to sell cannabis products for medical, scientific and therapeutic purposes, with a space for immediate consumption by consumers, including tourists; and
• A conditional therapeutic retail license to provide therapeutic or spa services utilizing cannabis products.
• Marigold's cultivation farm is operational and has harvested approximately 2,500 kg of cannabis to date.
• The Company has taken possession of 10 acres of land at Block B, Lot 2, part of Bernard Lodge, St. Catherine, from the Sugar Company of Jamaica in anticipation of expanding its cultivation as demand dictates.
• Two Herb House locations, the first in Kingston, namely the Sensi Medical Cannabis House, and the second, Portmore, are expected to open in January 2019, additional locations are currently planned for other high demand regions of Jamaica.
• Jamaica boasts 22 employees dedicated to the cultivation, processing and operations of the facility and maintenance of the corporate brand.

Argentina

• Aphria's subsidiary in Argentina, ABP, is a well-established and successful pharmaceutical import and distribution company.
• ABP is championing the research and clinical study of medical cannabis, including through its partnership with Hospital de Pediatria Garrahan, one of the most recognized and credible medical institutions in South America.
• In October 2018, ABP delivered 1,500 bottles of Aphria's renowned Rideau CBD oil, which were provided to Hospital de Pediatria Garrahan for use in a clinical study focused on treating refractory epilepsy in children. The clinical study, which involves 100 patients and will be conducted over 2.5 years, will be one of the foundational global scientific and medical studies of its kind focused on treating refractory epilepsy in children.
• In order to undergo its ISO 9001 inspection on October 25, 2018, ABP engaged in a retrofit of the building in October 2018.
• Aphria and ABP, in close partnership with the Argentinean government, continue to advance opportunities for medical cannabis in the country, including the potential for in-country cultivation.
• APB operates a pharmaceutical distribution warehouse and retail pharmacy and distributes to an extensive network of pharmacies, distributors, government clinics and hospitals throughout Argentina.
• ABP also holds agreements with the Top 20 health insurance companies, a strategic advantage in reaching patients accessing Argentina's free public healthcare system.

"Aphria has developed and launched a comprehensive suite of brands, built a roster of strategic partners and continues to focus on research, innovation and product development in Canada and internationally. Aphria has experienced tremendous growth and will continue to lead the evolution of the industry in the years to come. It is the commitment of our incredible team and partners that has gotten us to where we are today, making Aphria a global cannabis success story," added Mr. Neufeld.
"Yesterday, I, along with other members of our Executive Management team, stepped up to demonstrate our confidence in the Company's business plan, growth strategy, integrity and value of the assets by personally investing more than $3.1 million in Aphria's common shares," concluded Mr. Neufeld.
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