Aphria stock and Tilray stock rallied after-hours Tuesday on a report that the two Canadian cannabis producers were discussing a merger that would create the nation’s biggest weed company — but potentially move its new headquarters to the U.S. Other marijuana stocks also rose late Tuesday.
Under the possible deal, as reported by BNN Bloomberg, the combined company would lord over 19% of Canada’s recreational pot market.
The possible plans to move the new company’s headquarters to the U.S. would allow it to tap a rapidly growing, legalizing market. An announcement could come as soon as this week, BNN Bloomberg said.
Aphria (APHA) would likely hold most of the new company’s board seats. Its shareholders would own a 60% of the new company, BNN Bloomberg said.
If the deal went through, the new company would likely keep Tilray’s (TLRY) name, BNN Bloomberg said. But it would put Aphria CEO Irwin Simon in the top spot.
Tilray CEO Brendan Kennedy, the story said, could take a seat on the new company’s board, but was unlikely to keep any executive-level job.
Talks were continuing, BNN Bloomberg said, with no guarantee the deal will go through. But Aphria and Tilray were looking to save as much as $100 million in annualized cost savings, the story said.
Under the possible deal, Aphria would do the heavy lifting on producing weed in Canada. The fate of Tilray’s production…