OTTAWA — Hexo Corp. says it will buy 48North Cannabis Corp in a deal valued at $50 million.
Ottawa-based Hexo says the deal is structured so 48North shareholders will receive 0.02366 of a Hexo common share, a 20 per cent premium on the 10-day volume-weighted average price.
Hexo says the deal could generate up to $12 million worth of accretive synergies within one year of closing and will position the company to keep growing domestically and internationally.
Hexo says the acquisition will bring the company closer to its goal of achieving a top two position in Canada for adult-use cannabis sales.
Hexo previously announced it would buy pot company Zenabis Global Inc. for $235 million in February, while 48North said in March that it would lay off about 20 per cent of its staff and end outdoor cultivation at an Ontario facility.
The deal has been unanimously approved by both company's boards, but still needs the approval of two-thirds of 48North shareholders and includes a $2 million fee 48North will have to pay Hexo if the deal is terminated.
This report by The Canadian Press was first published May 17, 2021.
Companies in this story: (TSX:HEXO, TSX:ZENA)
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