TSX:FIRE - Post Discussion
Post by
WealthBuilder99 on May 06, 2021 9:19pm
Canopy Premium Being Offered
The 66% premium offered by Canopy at the date of the deal has been effectively reduced to 26% at current prices, using the previous days Supreme stock price as the reference point. Still no date for vote announced. I wonder if whether this decline keeps up, it will influence shareholders to vote down the deal. Supreme is already fairly inexpensive so downside seems somewhat limited.
With the increasing need for the sector to consolidate it is also possible this may cause someone else to make a bid for Supreme. Beena did say they had several suitors take a look at Supreme over the last 6-12 months. Another bid is most likely a low probability event mind you.
I feel it would make a lot of sense for Aphria/Tilray to pick up Supreme. Reasons:
- Simon (CEO) stated they were targetting a 30% Canadian market share
- They have already made a number of international moves so they may look to strengthen their home market
- They had great success acquiring the Broken Coast brand some years back. Supreme would be one of a number of limited options for them to replicate their success
- Outflank Canopy, their main competitor, and prevent them from gaining a strong foothold in the Canadian market
Most likely the deal will go through, but what do people think?
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