uploads///Green Growths Premium on Aphria

Is Aphria Really a ‘Failed Investment’ as Green Growth Indicated

By

Jan. 7 2019, Published 8:42 a.m. ET

Green Growth’s selling points

While addressing Aphria’s (APHA) shareholders, Green Growth’s press release highlighted the synergies the two companies can create following the takeover. Green Growth specifically highlighted the “U.S. market, with significantly greater long-term sales potential.”

Green Growth put a value of 2.8 billion Canadian dollars ($2.1 billion) or 11 Canadian dollars per share. This price represents a premium of roughly 45% over its closing price of 7.6 Canadian dollars per share on December 27.

Article continues below advertisement

Failed investment?

In the same press release, Green Growth stated that it has received early interest from “frustrated” Aphria shareholders in favor of this takeover. Green Growth further stated that these shareholders “want a way out of a failed investment.” However, one important consideration in this takeover bid for investors to consider is the validity of the claim that Aphria is a “failed investment.” After all, if this were the case, why would Green Growth pay a 45% premium for the company?

In the next part, we’ll discuss what Green Growth values about Aphria and why these things would make other Canadian cannabis (MJ) players such as Canopy Growth (WEED) (CGC), Aurora Cannabis (ACB), and Cronos Group (CRON) attractive.

Advertisement

More From Market Realist

  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.