Acreage Holdings ACRGF

RE:RE:RE:It is more important to watch Canopy price than Acreage pric

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You don’t get a “price”.  Apart from the $2.55 advance payment no cash changes hands.  There will be a share exchange at the exchange ratio:  every share of Acreage will convert to 0.5818 shares of Canopy at the triggering event.  Obviously their price is relevant to calculating in dollar terms the value of the deal, but it is a fixed number of Canopy shares that are the main consideration (subject to Acreages’ flexibility to add another 58 million shares to the mix in the meantime).  $3.4 billion is only the described value of an exchange if it occurred now.  How else can you describe a future share exchange value?  Nobody knows what the average trading prices will be at an uncertain future date, but in the meantime presumably Acreage will follow Canopy’s price, with an adjustment for currency exchange, another for risk of no legalization, and some arbitrage discount against delay or non-approval of the deal.   

Canopy will be a big interlisted company, far greater share liquidity and stability with a greater international asset pool.  That helps a lot in the meantime offering shares for State operators shopping for a major corporate alliance.  Which paper would you want - Acreage as it stood prior to this deal, or Acreage representing .5818 of a Canopy share?  The people vending in their businesses are risking big dollars - tens of millions - they want greater security.  

As as for the upside on legalization, just let Wall Street, the big US ETF’s and Mutual Funds sink their teeth into a new hot sector and wait and see what happens.  Just don’t wait too long because what goes up usually comes down ... escalator up, elevator down.   Meantime, if you are a contrarian you might note that the major gains in the DOW in the past few years are almost entirely net share buybacks, meaning ownership is being consolidated, not distributed.  This long bull market pumped by quantitative easing from central banks has potentially a huge way up to go - Main Street is not back in the equities markets since the big Lehman crash and burn in 2008, and there are mountains of cash on the sidelines.

When the US markets go up pushed by frenzy equity buying, if marijuana stocks are a hot sector ... nobody holding a principal player like Canopy is going to be disappointed.

Or some outlier event occurs shocking the world financial system and we’re all in deep hot water, in which case, got gold or a basket of safe currencies?

Good luck.  No risk no profit.  Nothing is ever certain.

cg