Operational Efficiencies Expected to
Generate Approximately US$81 Million Annual Pre-Tax Cost-Saving
Synergies for New Tilray Within Eighteen Months
Irwin D. Simon, Aphria’s Chairman and CEO,
will Lead the New Tilray and Has Appointed New Executive Leadership
Team; New Members of the Board of Directors Also Appointed
New Tilray Poised to Transform the Global
Cannabis Industry as a Consumer Packaged Goods Powerhouse with a
Diversified Portfolio of Leading Brands
Renewed Financial Strength to Drive
Accelerated Growth Strategy and Sustained Profitability
Tilray’s Shares Will Continue Trading on the
NASDAQ Under Symbol “TLRY”; Starting May 5, 2021, Tilray’s Shares
Will Commence Trading on the Toronto Stock Exchange Under Symbol
“TLRY”
Tilray, Inc. (“Tilray”) and Aphria Inc. (“Aphria”) today
announced the completion of the previously announced business
combination, ushering in a new era in the global cannabis industry.
The combined company, which will operate as Tilray (the “Company”),
brings together two highly complementary businesses to create the
leading cannabis-focused consumer packaged goods (“CPG”) company
with the largest global geographic footprint in the
industry. The combined company had a market cap of
approximately US$8.2 billion based on the closing stock prices on
April 30, 2021.
The Company’s class 2 common stock (“Tilray Shares”) will
continue to trade on the Nasdaq Global Select Exchange under the
ticker symbol “TLRY” and will commence trading on the Toronto Stock
Exchange under the ticker symbol “TLRY” on May 5, 2021. As
previously announced, each Aphria shareholder received 0.8381 of a
Tilray Share for each Aphria common share (each an “Aphria Share”)
held on April 30, 2021, the effective time of the transaction.
Holders of Tilray Shares prior to the completion of the transaction
continue to hold their Tilray Shares with no adjustment as a result
of the transaction. An early warning report in respect of the
Company’s acquisition of all of the outstanding Aphria Shares
pursuant to the transaction will be filed on SEDAR and will be
available under Aphria’s issuer profile at www.sedar.com.
Irwin D. Simon, the Company’s Chairman and Chief Executive
Officer, commented, “Our focus now turns to execution on our
highest return priorities including business integration and
accelerating our global growth strategy. Covid-19 related lockdowns
have presented unique challenges across Canadian and German
markets. As these markets begin to re-open, Tilray is poised to
strike and transform the industry with our highly scalable
operational footprint, a curated portfolio of diverse medical and
adult-use cannabis brands and products, a multi-continent
distribution network, and a robust capital structure to fund our
global expansion strategy and deliver sustained profitability and
long-term value for our stakeholders.”
Mr. Simon continued, “Our global team is laser-focused on
turning potential into performance and addressing consumer and
patient needs for safe, innovative, and high-quality products. We
are eager to get to work and want to thank both the Aphria and the
Tilray Boards of Directors and especially Brendan Kennedy for his
spirit of partnership and irrepressible belief in the art of
‘what’s possible.’ We will benefit enormously from his legacy and
continued service on the Tilray Board.”
We expect that the business combination will provide, among
others, the following financial and strategic benefits:
World’s Largest Global Cannabis Company. The combination
of Aphria and Tilray brings together two highly complementary
businesses to create the leading cannabis-focused CPG company with
the largest global geographic footprint in the industry.
Strategic Footprint and Operational Scale. We believe
that the Company has the strategic footprint and operational scale
necessary to compete more effectively in today’s consolidating
cannabis market with a strong, flexible balance sheet, strong cash
balance, and access to capital, which we believe will give the
Company the ability to accelerate growth and deliver long-term
sustainable value for stockholders.
Low-cost, State-of-the-Art Production & the Leading
Canadian Adult-Use Cannabis Producer. The demand for the
Company’s products will be supported by low-cost state-of-the-art
cultivation, processing, and manufacturing facilities, and it will
have a complete portfolio of branded cannabis 2.0 products to
strengthen its leadership position in Canada.
Positioned to Pursue an Accelerated International Growth
Strategy. The Company is well-positioned to pursue
international growth opportunities with its strong medical cannabis
brands, distribution network in Germany, and end-to-end European
Union Good Manufacturing Practices (“EU-GMP”) supply chain, which
includes its production facilities in Portugal and Germany.
Enhanced Consumer Packaged Goods Presence and Infrastructure
in the U.S. In the United States, Tilray has a strong consumer
packaged goods presence and infrastructure with two strategic
pillars, including SweetWater, a leading cannabis lifestyle branded
craft brewer, and Manitoba Harvest, a pioneer in branded hemp, CBD
and wellness products with access to 17,000 stores in North
America. In the event of federal permissibility, the Company
expects to be well-positioned to compete in the U.S. cannabis
market given its existing strong brands and distribution system in
addition to its track record of growth in consumer-packaged goods
and cannabis products.
Substantial Synergies. The Company expects to deliver
approximately US$81 million (C$100 million) of annual pre-tax cost
synergies within eighteen months and plans to achieve cost
synergies in the key areas of cultivation and production, cannabis
and product purchasing, sales, and marketing, and corporate
expenses.
Tilray’s new leadership team and board of directors will provide
a strong foundation for the Company to accelerate growth and
capitalize on the business combination’s many benefits.
Effective on closing, the senior management team and Board of
Directors of the Company were reconstituted as follows:
- Irwin D. Simon, Chairman and Chief Executive Officer
- Carl Merton, Chief Financial Officer
- Denise Faltischek, Head of International and Chief Strategy
Officer
- Jim Meiers, President, Canada
- Jared Simon, President, Manitoba Harvest and Tilray
Wellness
- Rita Seguin, Chief Human Resources Officer
- Dara Redler, Interim Chief Legal Officer and Corporate
Secretary
- Berrin Noorata, Chief Corporate Affairs Officer
- Lloyd Brathwaite, Chief Information Officer
- Freddy Bensch, Chief Executive Officer, SweetWater
Board of Directors:
- Irwin D. Simon, Chairman
- Renah Persofsky, ICD.D, Vice-Chair (Lead Director) and Chair of
the Nominating and Governance Committee, Independent Director
- Jodi Butts, Nominating & Governance Committee Member,
Independent Director
- David Clanachan, Newly Appointed Independent Director
- John M. Herhalt Chair of the Audit Committee, Independent
Director
- David Hopkinson, Nominating and Governance Committee &
Compensation Committee Member, Independent Director
- Brendan Kennedy, Current Director and Former CEO, Tilray
- Tom Looney, Audit Committee & Compensation Committee
Member, Independent Director
- Walter Robb, Chair of the Compensation Committee & Audit
Committee Member, Independent Director
New Tilray Branding
The new Tilray logo blends both Aphria and legacy Tilray’s
branding into a design that reflects the new Company’s growing
portfolio of brands across cannabis-lifestyle and wellness product
categories, including medical, adult-use, hemp foods, and
beverages. The continued use of “Tilray” as the Company’s name
evokes hard work and hope – til shortened from tilling the soil and
ray as in a ray of sunshine. Tilray is a pioneer navigating toward
the end of prohibition and built to deliver on the collective
wellbeing of the Company’s employees, consumers, patients,
partners, and local communities.
Advisors
Jefferies LLC served as financial advisor, and DLA Piper LLP
(US), DLA Piper (Canada) LLP, and Fasken Martineau Dumoulin LLP
acted as legal counsel to Aphria. Cowen served as financial
advisor, and Cooley LLP and Blake, Cassels, and Graydon LLP acted
as legal counsel to Tilray.
About Tilray
Tilray Inc. is a leading global cannabis-lifestyle and consumer
packaged goods company with operations in Canada, the United
States, Europe, Australia, and Latin America that is changing
people's lives for the better – one person at a time – by inspiring
and empowering the worldwide community to live their very best life
by providing them with products that meet the needs of their mind,
body, and soul and invoke a sense of wellbeing. Tilray’s mission is
to be the trusted partner for its patients and consumers by
providing them with a cultivated experience and health and
wellbeing through high-quality, differentiated brands and
innovative products. A pioneer in cannabis research, cultivation,
and distribution, Tilray’s unprecedented production platform
supports over 20 brands in over 20 countries, including
comprehensive cannabis offerings, hemp-based foods, and alcoholic
beverages.
For more information on how we open a world of wellbeing, visit
Tilray.com.
Forward-Looking Statements
Certain information in this communication constitutes
forward-looking information or forward-looking statements
(together, “forward-looking statements”) under Canadian securities
laws and within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended, which are intended to be covered by the safe
harbor created by such sections and other applicable laws.
Forward-looking statements are provided for the purpose of
presenting information about management’s current expectations and
plans relating to the future, and readers are cautioned that such
statements may not be appropriate for other purposes. Any
information or statements that are contained in this communication
that are not statements of historical fact may be deemed to be
forward- looking statements, including, but not limited to,
statements regarding the expected strategic and financial benefits
of the business combination. Words such as “forecast”, “future”,
“should”, “could”, “enable”, “potential”, contemplate”, “believe”,
“anticipate”, “estimate”, “plan”, “expect”, “intend”, “may”,
“project”, “will”, “would” and the negative of these terms or
similar expressions identify forward-looking statements, although
not all forward-looking statements contain these identifying words.
Certain material factors or assumptions were used in drawing the
conclusions contained in the forward-looking statements throughout
this communication. Forward-looking statements reflect current
beliefs of management of the Company with respect to future events
and are based on information currently available to each respective
management team including the reasonable assumptions, estimates,
analysis and opinions of management of the Company considering
their experience, perception of trends, current conditions and
expected developments as well as other factors that each respective
management believes to be relevant as at the date such statements
are made. Forward-looking statements involve significant known and
unknown risks and uncertainties. Many factors could cause actual
results, performance or achievement to be materially different from
any future forward-looking statements. There is a risk that some or
all the expected benefits of the business combination may fail to
materialize or may not occur within the time periods anticipated by
the Company. The challenge of coordinating previously independent
businesses makes evaluating the business and future financial
prospects of the Company following the business combination
difficult. Material risks and uncertainties that could cause actual
results to differ from forward-looking statements include the
inherent uncertainty associated with the financial and other
projections a well as market changes arising from governmental
actions or market conditions in response to the COVID-19 public
health crisis; the prompt and effective integration of the Company;
the ability to achieve the anticipated synergies and value-creation
contemplated by the business combination; the response of business
partners and retention as a result of the business combination; the
impact of competitive responses to the business combination; and
the diversion of management time on business combination-related
issues. Readers are cautioned that the foregoing list of factors is
not exhaustive. Other risks and uncertainties not presently known
to the Company or that the Company presently believe are not
material could also cause actual results or events to differ
materially from those expressed in the forward-looking statements
contained herein. For a more detailed discussion of risks and other
factors, see the most recently filed annual information form of
Aphria and the annual report filed on form 10-K of Tilray made with
applicable securities regulatory authorities and available on SEDAR
and EDGAR. The forward-looking statements included in this
communication are made as of the date of this communication and the
Company does undertake any obligation to publicly update such
forward-looking statements to reflect new information, subsequent
events or otherwise unless required by applicable securities
laws.
For more information, visit: www.Tilray.com
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version on businesswire.com: https://www.businesswire.com/news/home/20210503005294/en/
Media: Berrin Noorata news@tilray.com
Investors Raphael Gross 203-682-8253
Raphael.Gross@icrinc.com
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