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Buds & Duds: iAnthus Capital rallies after closing its acquisition of MPX Bioceutical

Cronos Group declined following a downgrade to Hold by GMP Securities while Aphria fell after its board rejected Green Growth's hostile takeover bid
A pot plant
After its cannabis deal, iAnthus now has operations in 11 US states

Cannabis stocks in the US and Canada declined Wednesday, trading in the same direction as the S&P 500 Index.

The North American Marijuana Index, which tracks the top cannabis stocks in the US and Canada, fell 4.4% to 283.21. The S&P/TSX Composite Index was up 0.2%.

BUDS

iAnthus Capital Holdings Inc (OTCMKTS:ITHUF) (CSE: IAN) climbed 5.1% to US$5.58 after the New York cannabis company announced the closing of its acquisition of MPX Bioceutical Corp (OTCMKTS:MPXEF) (CSE:MPX).  

Under the deal, investors received 0.1673 common share of iAnthus for each MPX share held, representing a premium of almost 31% based on the closing price of iAnthus and Toronto-based MPX on October 17, iAnthus said in a statement.

The combined company now has operations in 11 US states, allowing it to operate 63 retail operations and 15 cultivation or processing facilities, according to iAnthus.

iAnthus was up 5.6% to C$7.37 in Canadian trading.

DUDS

Aphria Inc (NYSE:APHA) (TSE:APHA ) dropped 7.5% to US$9.91 in New York trading after announcing that its board has rejected the hostile bid from Green Growth Brands Inc (OTCMKTS:GGBXF) (CSE:GGB).

The hostile bid reflects a 23% discounto the cannabis company’s share price, Aphria said in a statement. It cited the 20-day volume-weighted average price of Green Growth’s shares immediately before the company announced its offer.

Acceptance of the offer would result in Aphria’s shareholders giving Green Growth shareholders a 36% interest in Aphria in exchange for shares in a company with limited experience in the cannabis industry, Aphria said in a statement.

Afria was down 6.9% to C$13.10 in Canadian trading. Green Growth fell 4.9% to US$4.26 on the OTC Markets and decreased 4.4% to C$5.61

Cronos Group Inc (NASDAQ:CRON) (TSE:CRON) dropped 6.9% to US$20.33 after GMP Securities LP reportedly downgraded the Toronto-based cannabis company to Hold from Buy and maintained its price target at C$24. 

In December, the tobacco giant Altria Group Inc (NYSE:MO) agreed to make a C$2.4 billion equity investment in Cronos.

Cronos fell 7.1% to C$26.66 in Canadian trading.

Contact Dennis Fitzgerald at [email protected]


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