Re: HIP and CMED merger: Agreed upon termsThe exact wordings of the merger terms are quoted below (based on the presentation made by HIP, still available on their website). Interestingly, the per vale of HIP share was considered only 0.50c at the time. So 33 for 1000 ratio comes to $0.83c which was quite good for the stakeholders. I am sure they issued millions of shares to make them big millionaires. So either way they deal was and is a great for them (not so much for new investors but who cares).
All share deal, by way of Plan of Arrangement
$0.505 per share based on an exchange ratio of 0.033 of CanniMed shares(1) Newstrike Fully Diluted Equity value of $200MM(1)(2)
Offer represents a premium of 15% to the 20 day VWAP(3)
Accretive to EBITDA, Earnings and EV/Capacity Per Share in 2019 before synergies
Opportunity for shareholders of both companies to participate in growth of both markets with long term equity upside
CanniMed shareholders - approximately 65.5%(1)(2) Newstrike shareholders - approximately 34.5%(1)(2)
Brent Zettl to remain as President and CEO
Jay Wilgar joining as Director and President of recreational division
Shareholder votes at both companies and closing targeted early January 2018 Shareholder voting:
• CanniMed - ordinary resolution (>50%)
• Newstrike - special resolution (>66 2/3%)