Green Growth’s offer
Green Growth’s offer came at a time when Aphria stock was being criticized by short sellers. Green Growth filed a formal offer this month to acquire all of Aphria’s (APHA) common outstanding shares. In return, Aphria shareholders will receive 1.5714 shares of Green Growth’s share per Aphria share. Green Growth’s offer valued Aphria at 11 Canadian dollars.
When Green Growth made the offer on December 27, Aphria was trading at nearly 7.6 Canadian dollars. Green Growth’s 1.5714 stock at 11 Canadian dollars puts Green Growth’s value per share at ~7 Canadian dollars. To learn more, read Valued at $2.1 Billion, Aphria Isn’t Worthless Anymore.
On December 27–January 31, Green Growth’s share price fell to 5.31 Canadian dollars. To match the offer of 11 Canadian dollars, Green Growth would have to offer ~2.07 per share for one Aphria share. When Green Growth’s price falls, it becomes even harder for the company to acquire Aphria. On December 27–January 31, Aphria’s share price increased to 11.4 Canadian dollars, which was slightly more than Green Growth’s offer.
Next, we’ll discuss Green Growth’s premium on Aphria.