The publicly-traded Canadian marijuana companies on our list have announced large financings over the past month
SmallCapPower | November 22, 2017: The stocks on our list represent four of the largest Canadian marijuana companies. These four companies have announced or closed financings worth ~$540 million. The financings have been followed by increased M&A activity in the sector, as Aurora Cannabis announced its intention to launch a takeover bid for CanniMed Therapeutics. The takeover attempt was announced on Nov. 20, and proposed an offer price of $24 per share, a 57% premium to its prior closing price. According to a report by EY, more consolidation is expected in the industry, as the consulting firm believes that the marijuana sector in Canada will be dominated by a few large players in the coming years.
Canopy Growth Corp. (TO:WEED) – $18.59
Pharmaceuticals
As Canada’s largest publicly-traded cannabis company, Canopy Growth owns and operates a number of facilities that comprise approximately 500,000 square feet. In addition, the company owns a variety of diverse brands that include Tweed and Bedrocan.
The company announced a $245-million equity financing with Constellation Brands Inc (NYSE:STZ) in exchange for 18.9M shares, or 9.9% of the company. In addition, Constellation received 18.9M purchase warrants, which could increase its stake in Canopy to 20%.
- Market Cap: $3,553 Million
- Month over Month Return: 45.7%
- Average Daily Volume – 30 days: 5,900,000
- Average Daily Volume – 90 Days: 3,375,000
Aurora Cannabis Inc. (TO:ACB) – $5.85
Pharmaceuticals
Aurora Cannabis is a licensed producer and seller of medical marijuana and cannabis oil under the ACMPR. Aurora sells its products over the phone, online or through its mobile app and offers a delivery service to its customers. Currently, the company is engaged in the construction of its new 800,000-square-foot production facility in Alberta called Aurora Sky.
On Nov. 16, Aurora announced a $100M financing in exchange for 100K special warrants at a price of $1,000 per warrant. The warrants are automatically exercisable into unsecured convertible debentures with a face value of $1,000 each at a 6% coupon maturing in five years. In addition, the debentures are exercisable into common shares at $6.50 per share.
- Market Cap: $2,351 Million
- Month over Month Return: 107.4%
- Average Daily Volume – 30 days: 11,760,000
- Average Daily Volume – 90 Days: 5,430,000
MedReleaf Corp. (TO:LEAF) – $16.09
Pharmaceuticals
MedReleaf is a licensed producer of medical marijuana under the ACMPR. With a focus on R&D, MedReleaf aims to provide high-quality products for its patients. The company operates two facilities in Ontario, which comprise a total 265,000 square feet.
On Nov. 14, MedReleaf announced a $100.5M bought deal financing, in exchange for 6.1M shares at $16.55 per share.
- Market Cap: $1,463 Million
- Month over Month Return: 46.3%
- Average Daily Volume – 30 days: 288,000
Average Daily Volume – 90 Days: 163,000
Aphria Inc. (TO:APH) – $8.89
Pharmaceuticals
Aphria is a licensed producer and supplier of medical marijuana under the ACMPR. The company operates a production facility in Canada, and invests in marijuana businesses across North America. Aphria’s flagship greenhouse production facility is located on a 169-acre property in Leamington, Ont.
On Nov. 7, Aphria closed a $92M bought deal financing in exchange for 12.7M shares priced at $7.25 per share.
- Market Cap: $1,348 Million
- Month over Month Return: 28.1%
- Average Daily Volume – 30 days: 2,410,000
- Average Daily Volume – 90 Days: 1,910,000
Disclosure: Neither the author nor any of the principals at SmallCapPower, or their family members, own units in any of the companies mentioned above.