OUR 9TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / HEMP / PSYCHEDELIC SECTORS
M&A Transactions
M&A Transaction Chart
Viridian publishes weekly data on M&A transactions in the Cannabis/CBD/Psychedelic industries. This data includes information about the buyer and seller (public/private, state/country location), deal size, deal structure (cash, stock, earn-out), pricing, share information, and deal implied valuation.
Week ended 06/23/2023
Week ended 06/23/2023
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M&A Transactions Commentary
Week ended 06/23/2023
The Only M&A Deal of the Week:
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- On June 22, 2023, Tilray Brands, Inc. (TLRY: Nasdaq)(TLRY: TSX), the largest Canadian LP by market cap, announced the completion of its previously announced acquisition of HEXO Corp. (HEXO: Nasdaq)(HEXO: TSX) in a transaction valued at $154.22M
- Common Equity consideration of $61.37M was paid in shares of Tilray stock at a fixed ratio of .4352 shares of Tilray per common Hexo share and 1.23 shares of Tilray per Hexo convertible preferred shares.
- Tilray also assumed $92.855 of HEXO debt in the transaction.
- The implied enterprise value represents 1.65x HEXO’s LTM revenue and 1.88x its consensus 2023 revenue estimates. These metrics are in line with the 3rd quartile measures of 1.98x and 1.65x, respectively, for the 15 Canadian LPs with market caps over $20M.
- Tilray overpaid for a company with four quarters of sequentially declining revenues, negative gross profit, and stubbornly high operating expenses. Tilray’s other option would have been to credit-bid the HEXO bonds it owned in what would have probably been a HEXO bankruptcy proceeding absent the acquisition. HEXO’s shareholders had very little choice but to approve the deal. Tilray may have been understandably concerned that financial distress would further impair HEXO’s operating performance.
Week ended 06/23/2023
This is the MA basic
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Viridian publishes weekly insights on the M&A landscape in the Cannabis/CBD/Psychedelic industries. These insights typically highlight the most interesting/meaningful M&A transactions for that week, and commentary on market conditions, M&A deal structures, target regions for acquirers, and industry sectors ripe for consolidation.