The multi-billion dollar merger between Acreage Holdings and Canopy Growth is moving ahead.
Shareholders in New York-based Acreage have today (May 28) voted in the majority (91%) to approve the proposed arrangement with Canopy.
Key executive management members at Acreage have agreed to enter into extended lockup agreements pursuant to the previously agreed arrangement with Canopy.
In order to go ahead, the deal is subject to approval of the shareholders of each of Acreage and Canopy Growth as well as the Supreme Court of British Columbia.
Under the terms of the agreement, Acreage Holders will receive an immediate aggregate total payment of US$300m or approximately US$2.55 per Acreage Subordinate Voting Share.
The companies will also execute a licensing agreement granting Acreage access to Canopy Growth’s line-up of brands such as Tweed and Tokyo Smoke, along with other intellectual property. Until this right is exercised, the two companies will continue to operate independently.
The deal will go through to its fullest extent when cannabis production and sale becomes federally legal in the United States.
Acreage announced today (May 28) that each of its five senior executives has agreed to resale restrictions in respect of each such person’s current and certain future shareholdings.
These ‘insiders’ have been subject to resale restrictions from the first day of trading on November 15, 2018 and have voluntarily agreed to remain locked up; with periodic releases at intervals following: (i) completion of the arrangement with Canopy Growth; and (ii) the subsequent acquisition by Canopy Growth of the outstanding Acreage shares.
“Our executives remain 110% committed to the long-term Acreage story,” said Kevin Murphy, Founder and Chief Executive Officer of Acreage Holdings (ACRZF).
“Additionally, I’m proud to say that shareholders representing approximately 38% of votes eligible to be counted for purposes of the disinterested shareholder approval have already indicated their support of the deal. This is a clear indication of the unyielding support of our long-term shareholders, for which I’m eternally grateful.”
Acreage claims to be the largest vertically integrated, multi-state owner of cannabis licenses and assets in the U.S. (with respect to the number of states with cannabis related licenses).
It has management services or consulting agreements in place with license holders to assist in operations in 20 states (including pending acquisitions) with a population of approximately 180 million Americans, and an estimated 2022 total addressable market of more than $17 billion in legal cannabis sales, according to Arcview Market Research.Cannabis Business Worldwide