- Tilray is acquiring Natura Naturals, a licensed cultivator of cannabis in Ontario
- Deal doubles Tilray’s Canadian cultivation capacity
Tilray (TLRY) will pay C$35 million in total for Natura Naturals, comprised of C$15 million cash and C$20 million of Class 2 shares. In exchange, Tilray will receive a 662,000 sqft greenhouse, about 155,000 sqft that are currently licensed. This deal follows Tilray’s strategy of purchasing cannabis from third party suppliers and addressing the supply shortage in Canada’s recreational market.
Figures from the first month of sales after legalization were released and the Canadian market purchased $54M worth of marijuana. Annualized, this figure equates to $600M, but overall Canadian market estimates are expected to be north of $5B. Due to the new legislations, Canada’s cannabis market continues to develop the supply chain and open retail locations. Both these factors are expected to contribute to a growing market and present further opportunity for companies like Tilray.
Article by: Mick Ross
Mick is currently a full-time investor and formerly a buy-side analyst (2yrs) covering healthcare companies. Before that, he was a salesperson at a bulge-bracket firm, based in Dallas, Texas. Mick blogs to clarify and synthesize his investment thought process and to elicit feedback; additionally he likes to connect with other investors and swap ideas.