Canopy Growth to buy Tokyo Smoke owner Hiku Brands for C$269.2 mln

Entourage Health

10/07/2018 21:37

July 10 (Reuters) - Canada's Canopy Growth Corp  WEED.TO  is
buying Toyko Smoke cannabis owner Hiku Brands Co Ltd  HIKU.CD 
for C$269.2 million ($205.3 million), the latest deal in a
fast-consolidating sector ahead of legal recreational marijuana
sales. 
    Canopy Growth on Tuesday offered 0.046 of its shares, or
C$1.91 per share, for each Hiku share held, a premium of 30
percent to Hiku's Monday close.  urn:newsml:reuters.com:*:nCNWg2CjYa
    Hiku said on Tuesday it had terminated its deal with WeedMD
Inc  WMD.V , citing Canopy Growth's "superior proposal."
    Canadian marijuana companies have been on a buying spree to
beef up their portfolio with marijuana sales set to become legal
in the country from Oct. 17.
    In January, Aurora Cannabis Inc  ACB.TO  agreed to buy
CanniMed Therapeutics Inc  CMED.TO  for C$1.1 billion to create
the world's top marijuana producer by market value.  urn:newsml:reuters.com:*:nL4N1PJ4F5
    Canopy Growth bought Mettrum Health in 2016 and BC Tweed in
May this year. 
    West Kelowna-based Hiku owns cannabis brands such as Tokyo
Smoke, DOJA and Van der Pop.       
    The equity value of the deal is based on 140.95 million
outstanding Hiku shares, according to Thomson Reuters. 
    Hiku's Tokyo Smoke has been conditionally awarded one of
four master licenses for retail cannabis sales in Manitoba. 
    Canopy Growth's shares closed down 1.52 percent at C$38.10,
while Hiku ended marginally lower at C$1.46 on Tuesday. 
    
($1 = 1.31 Canadian dollars)

 (Reporting by Nivedita Balu in Bengaluru; Editing by Sriraj
Kalluvila)
 ((Nivedita.Balu@thomsonreuters.com; within U.S. +1 646 223
8780; outside U.S. +91 80 6749 4822; Reuters Messaging:
Nivedita.Balu.thomsonreuters.com@reuters.net))