Post/CP say Aphria rejects Xanthic's overtures

Post/CP say Aphria rejects Xanthic's overtures

Aphria Inc (C:APHA)
Shares Issued 249,762,289
Last Close 12/28/2018 $8.52

Monday December 31 2018 - In the News

The Financial Post reports in its Saturday edition that Aphria shares shot up as much as 14 per cent early Friday before easing back as investors responded to an American company's takeover proposal that valued the cannabis company at $2.8-billion. 

A Canadian Press dispatch to the Post says that Aphria shares were off their early highs at $8.46 after 30 minutes of trading at the Toronto Stock Exchange, up 89 cents from Thursday's close at $7.57. Ohio-based Xanthic Biopharma, which does business as Green Growth Brands, announced after Thursday's close that its offer valued its own shares at $7 each and Aphria shares at $11 per share. Aphria responded before markets opened on Friday, saying the actual value of Xanthic shares is substantially lower than the announced offer price and, at current market rates, undervalues the Leamington, Ont., cannabis producer. In early trading Friday, 

Xanthic shares fell 7 per cent to $4.60, down 38 cents, at the Canadian Securities Exchange. At that price, its offer of 1.5714 Xanthic shares would value Aphria shares at about $7.23. 

Aphria said in a statement Friday that "their proposal falls short of rewarding our shareholders for participating in such a transaction."

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Unfortunately, Mr. Hodson says no end is in sight. As long as (a) investors continue to panic, and rush to sell any stock targeted by short sellers, and (b) regulators do nothing, then we are likely to continue to see Canadian companies attacked by "short and distort" reports posted on the Internet.

Globe And Mail On APHA

Aphria Inc (C:APHA)
Shares Issued 249,762,289
Last Close 12/28/2018 $8.52
Monday December 31 2018 - In the News

Also Xanthic Biopharma Inc (2) (C:GGB) In the News

The Globe and Mail reports in its Saturday edition that a web of connections between Aphria and its suitor has come into focus in the wake of an unusual takeover offer for the Canadian cannabis company. 

A quadruple-bylined item led by Tim Kiladze says that Aphria directors, including chief executive officer Vic Neufeld, have been part of business dealings in the United States with the Schottensteins -- the U.S. family behind the recent takeover proposal from Xanthic Biopharma. Xanthic operates in the cannabis market as Green Growth Brands. 

Aphria director Shawn Dym has also previously served on Green Growth's board, and Mr. Neufeld has been on the advisory board of one of Green Growth's largest investors. 

The proposal comes with unusual terms relative to merger and acquisition norms. Aphria's board rejected the deal on Friday. 

Under the share-for-share deal, Green Growth has proposed to acquire Aphria for $11 per share or $2.8-billion. These figures are "based on a valuation of $7 a share" of Green Growth. 

As of Thursday's market close, the suitor's shares were worth $4.98 each. At $7 a share, the financing would be completed at roughly double the company's volume-weighted average trading price in December.

© 2018 Canjex Publishing Ltd.