Shareholders Encouraged to Visit Joint Company
Website for Information About the Proposed Aphria-Tilray
Combination
Anti-Trust Clearances Received and Transaction
Remains On-Track to Close in the Second Quarter of 2021
LEAMINGTON, ON and
NANAIMO, BC, Feb. 23, 2021
/PRNewswire/ - Aphria Inc. ("Aphria") (TSX: APHA and NASDAQ:
APHA), a leading global cannabis-lifestyle consumer packaged goods
company inspiring and empowering the worldwide community to live
their very best life, and Tilray, Inc. ("Tilray") (NASDAQ:
TLRY), a global pioneer in cannabis research, cultivation,
production and distribution, are pleased to announce the launch of
the website: www.aphriatilraytogether.com. This new, dedicated
resource seeks to provide shareholders of both companies with
pertinent information, news and updates leading up to the special
meetings of shareholders at which Aphria's and Tilray's respective
shareholders will vote on the resolutions necessary to implement
the proposed business combination of the two companies (the
"Transaction"). The website will also allow
shareholders and other interested parties to register for
Transaction updates that are made publicly available, so they
receive information directly to their e-mail addresses.
As disclosed in the preliminary joint proxy statement and
management information circular filed with regulators on
February 19, 2021, both companies are
pleased that the applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
has expired in relation to the Transaction (the "HSR
Clearance"). In addition, the companies have received a
no-action letter from the Competition Bureau of Canada in respect of the Transaction (the
"Competition Act Approval"), which confirms that the
Competition Bureau does not intend to challenge the Transaction
under the Competition Act (Canada). The receipt of the HSR
Clearance and the Competition Act Approval are two of the required
regulatory clearances that need to be obtained to satisfy the
conditions to closing of the Transaction. The closing of the
Transaction is currently expected to occur in the second quarter of
calendar year 2021.
Irwin D. Simon, Aphria's Chairman
and Chief Executive Officer commented, "The receipt of HSR
Clearance and Competition Act Approval represent a significant step
forward in bringing together these two companies, and we are
incredibly pleased that we remain on track to complete our business
combination in the second quarter of calendar year 2021.
Together, Aphria and Tilray expect to have a robust strategic
footprint in Canada and
internationally with the operational scale necessary to compete
more effectively in today's consolidating cannabis market. We
believe our strong, flexible balance sheet, cash position and
access to capital will provide us with the ability to accelerate
long-term sustainable growth and deliver attractive returns for
shareholders."
Benefits of the Transaction to Aphria Shareholders and Tilray
Stockholders
The Boards of Directors of both companies believe that, at this
stage of development and expansion of the global cannabis market,
those companies with financial strength and leading geographic
scale, product range and brand expertise are most likely to succeed
in the long-term. Further, the Boards of Directors of both
companies believe that the combination of Aphria and Tilray is
expected to unlock significant shareholder value as follows:
- The combination of Aphria and Tilray will create the world's
largest global cannabis company with pro forma revenue of
US$685 million (C$874 million) for the last 12 months as reported
by each company prior to the date of the announcement of the
Transaction on December 16, 2020, the
highest in the global cannabis industry.
- To meet demand, the combined company will have state-of-the-art
cultivation, processing and manufacturing facilities, as well as a
complete portfolio of branded cannabis 2.0 products to strengthen
its leadership position in Canada.
- Internationally, the combined company will be well-positioned
to pursue growth opportunities with its strong medical cannabis
brands, distribution network in Germany and end-to-end European Union Good
Manufacturing Practices supply chain, which includes its production
facilities in Portugal and
Germany.
- In the United States, the
combined company will have a strong consumer packaged goods
presence and infrastructure with two strategic pillars, including
SweetWater Brewing Company, LLC, a leading cannabis lifestyle
branded craft brewer, and Manitoba Harvest USA, LLC, a pioneer in branded hemp, CBD and
wellness products with access to 17,000 stores in North America. In the event of federal
permissibility in the United
States, the combined company expects to be well-positioned
to compete in the U.S. cannabis market given its existing strong
brands and distribution system in addition to its track record of
growth in consumer-packaged goods and cannabis products.
- The combination of Aphria and Tilray is expected to deliver
approximately US$78 million
(C$100 million) of annual pre-tax
cost synergies within 24 months of the completion of the
Transaction. The combined company expects to achieve cost synergies
in the key areas of cultivation and production, cannabis and
product purchasing, sales and marketing, and corporate
expenses.
Shareholder Questions
If you are an Aphria shareholder and have any questions, please
contact Laurel Hill Advisory Group, Aphria's proxy solicitation
agent, by telephone at 1-877-452-7184 toll-free in North America or at 416-304-0211 for collect
calls outside of North America or
by email at assistance@laurelhill.com.
If you are a Tilray shareholder and have any questions, please
contact MacKenzie Partners, Tilray's proxy solicitation agent, by
telephone at 1-800-322-2885 toll-free in North America or at 1-212-929-5500 for collect
calls outside of North America or
by email at proxy@mackenziepartners.com.
We Have A Good Thing Growing
About Aphria Inc.
Aphria Inc. is a leading global cannabis-lifestyle consumer
packaged goods company with operations in Canada, United
States, Europe and
Latin America, that is changing
people's lives for the better – one person at a time – by inspiring
and empowering the worldwide community to live their very best life
by providing them with products that meet the needs of their mind,
body and soul and invoke a sense of wellbeing. Aphria's mission is
to be the trusted partner for its patients and consumers by
providing them with a cultivated experience and health and
wellbeing through high-quality, differentiated brands and
innovative products. Headquartered in Leamington, Ontario, Aphria cultivates,
processes, markets and sells medical and adult-use cannabis,
cannabis-derived extracts and derivative cannabis products in
Canada under the provisions of the
Cannabis Act and globally pursuant to applicable international
regulations. Aphria also manufactures, markets and sells alcoholic
beverages in the United
States.
About Tilray®
Tilray (Nasdaq: TLRY) is a global pioneer in the research,
cultivation, production, and distribution of cannabis and
cannabinoids currently serving tens of thousands of patients and
consumers in 17 countries spanning five continents.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain information in this news release constitutes
forward-looking information or forward-looking statements
(together, "forward-looking statements") under Canadian securities
laws and within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended, which are intended to be covered by the safe
harbor created by such sections and other applicable laws. The
forward-looking statements are expressly qualified by this
cautionary statement. Forward-looking statements are provided for
the purpose of presenting information about management's current
expectations and plans relating to the future, and readers are
cautioned that such statements may not be appropriate for other
purposes. Any information or statements that are contained in this
news release that are not statements of historical fact may be
deemed to be forward-looking statements, including, but not limited
to, statements in this news release with regards to: (i) statements
relating to Aphria's and Tilray's strategic business combination
and the expected timing and closing of the Transaction including,
receipt of required shareholder approvals, court approvals and
satisfaction of other closing customary conditions; (ii) estimates
of pro-forma financial information of the combined company,
including in respect of expected revenues and production of
cannabis; (iii) the expected strategic and financial benefits of
the business combination, including estimates of future cost
reductions, synergies, including expected pre-tax synergies,
savings and efficiencies; (iv) statements that the combined company
anticipates having scalable medical and adult-use cannabis
platforms expected to strengthen the leadership position in
Canada, internationally and,
eventually in the United States;
(v) statements that the combined company is expected to offer a
diversified and branded product offering and distribution
footprint, state-of-the-art cultivation, processing and
manufacturing facilities; (vi) statements in respect of operational
efficiencies expected to be generated as a result of the
Transaction in the amount of approximately C$100 million of pre-tax annual cost synergies;
and (vii) statements regarding the value and returns to
shareholders expected to be generated by the business combination
and (viii) expectations of future balance sheet strength and future
equity. Aphria and Tilray use words such as "forecast", "future",
"should", "could", "enable", "potential", "contemplate", "believe",
"anticipate", "estimate", "plan", "expect", "intend", "may",
"project", "will", "would" and the negative of these terms or
similar expressions to identify forward-looking statements,
although not all forward-looking statements contain these
identifying words. Certain material factors or assumptions were
used in drawing the conclusions contained in the forward-looking
statements throughout this news release, including the ability of
the parties to receive, in a timely manner and on satisfactory
terms, the necessary shareholder and court approvals for the
Transaction, the ability of the parties to satisfy, in a timely
manner, the conditions to closing of the Transaction and other
expectations and assumptions concerning the Transaction.
Forward-looking statements reflect current beliefs of management of
Aphria and Tilray with respect to future events and are based on
information currently available to each respective management team
including the reasonable assumptions, estimates, analysis and
opinions of management of Aphria and Tilray considering their
experience, perception of trends, current conditions and expected
developments as well as other factors that each respective
management believes to be relevant as at the date such statements
are made. Forward-looking statements involve significant known and
unknown risks and uncertainties. Many factors could cause actual
results, performance or achievement to be materially different from
any future forward-looking statements. Factors that may cause such
differences include, but are not limited to, risks assumptions and
expectations described in Aphria's and Tilray's critical accounting
policies and estimates; the adoption and impact of certain
accounting pronouncements; Aphria's and Tilray's future financial
and operating performance; the competitive and business strategies
of Aphria and Tilray; the intention to grow the business,
operations and potential activities of Aphria and Tilray; the
ability of Aphria and Tilray to complete the Transaction; Aphria's
and Tilray's ability to provide a return on investment; Aphria's
and Tilray's ability to maintain a strong financial position and
manage costs, the ability of Aphria and Tilray to maximize the
utilization of their existing assets and investments and that the
completion of the Transaction is subject to the satisfaction or
waiver of a number of conditions as set forth in the Arrangement
Agreement. There can be no assurance as to when these conditions
will be satisfied or waived, if at all, or that other events will
not intervene to delay or result in the failure to complete the
Transaction. There is a risk that some or all the expected benefits
of the Transaction may fail to materialize or may not occur within
the time periods anticipated by Aphria and Tilray. The challenge of
coordinating previously independent businesses makes evaluating the
business and future financial prospects of the combined company
following the Transaction difficult. Material risks that could
cause actual results to differ from forward-looking statements also
include the inherent uncertainty associated with the financial and
other projections a well as market changes arising from
governmental actions or market conditions in response to the
COVID-19 public health crisis; the prompt and effective integration
of the combined company; the ability to achieve the anticipated
synergies and value-creation contemplated by the Transaction; the
risk associated with Aphria's and Tilray's ability to obtain the
approval of the proposed transaction by their shareholders required
to consummate the Transaction and the timing of the closing of the
Transaction, including the risk that the conditions to the
Transaction are not satisfied on a timely basis or at all; the risk
that a consent or authorization that may be required for the
Transaction is not obtained or is obtained subject to conditions
that are not anticipated; the outcome of any legal proceedings that
may be instituted against the parties and others related to the
Arrangement Agreement; unanticipated difficulties or expenditures
relating to the Transaction, the response of business partners and
retention as a result of the announcement and pendency of the
Transaction; risks relating to the value of Tilray's common stock
to be issued in connection with the transaction; the impact of
competitive responses to the announcement of the Transaction; and
the diversion of management time on transaction-related issues.
Readers are cautioned that the foregoing list of factors is not
exhaustive. Other risks and uncertainties not presently known to
Aphria and Tilray or that Aphria and Tilray presently believe are
not material could also cause actual results or events to differ
materially from those expressed in the forward-looking statements
contained herein. For a more detailed discussion of risks and other
factors, see the most recently filed annual information form of
Aphria and the annual report filed on form 10-K of Tilray made with
applicable securities regulatory authorities and available on SEDAR
and EDGAR. The forward-looking statements included in this news
release are made as of the date of this news release and neither
Aphria nor Tilray undertake any obligation to publicly update such
forward-looking statements to reflect new information, subsequent
events or otherwise unless required by applicable securities
laws.
Additional Information About the Transaction and Where to
Find It
This news release is not intended to and does not constitute an
offer to sell or the solicitation of an offer to subscribe for or
buy or an invitation to purchase or subscribe for any securities or
the solicitation of any vote or approval in any jurisdiction, nor
shall there be any sale, issuance or transfer of securities in any
jurisdiction in contravention of applicable law. This release is
being made in respect of the proposed transaction involving Aphria
and Tilray pursuant to the terms of an arrangement agreement by and
among Aphria and Tilray and may be deemed to be soliciting material
relating to the proposed transaction.
In connection with the Transaction, Tilray has filed a
preliminary proxy statement on Schedule 14A (which is subject to
completion and may be amended) containing important information
about the Transaction and related matters. Such preliminary
proxy statement is subject to review by the SEC before
finalization. Such preliminary proxy statement has also been
made available by Aphria and Tilray on their respective SEDAR
profiles. Tilray will file a definitive proxy statement and Aphria
will file a management information circular upon the completion of
the SEC review process. Additionally, Aphria and Tilray will file
other relevant materials in connection with the Transaction with
the applicable securities regulatory authorities. Investors and
security holders of Aphria and Tilray are urged to carefully read
the entire management information circular and definitive proxy
statement (including any amendments or supplements to such
documents), respectively, before making any voting decision
with respect to the Transaction because they contain important
information about the Transaction and the parties to the
Transaction. The Aphria management information circular and the
Tilray definitive proxy statement will be mailed to the Aphria and
Tilray shareholders, respectively, as well as be accessible on the
SEDAR and EDGAR profiles of the respective companies.
Investors and security holders of Tilray can obtain a free copy
of the preliminary proxy statement, and when available, the
definitive proxy statement, as well as other relevant filings
containing information about Tilray and the Transaction, including
materials incorporated by reference into the proxy statement,
without charge, at the SEC's website (www.sec.gov) or from Tilray
by contacting Tilray's Investor Relations at (203) 682-8253, by
email at Raphael.Gross@icrinc.com, or by going to Tilray's Investor
Relations page on its website at
https://ir.tilray.com/investor-relations and clicking on the link
titled "Financials."
Investors and security holders of Aphria will be able to obtain
a free copy of the management information circular, as well as
other relevant filings containing information about Aphria and the
Transaction, including materials incorporated by reference into the
information circular, without charge, on SEDAR at
www.sedar.com or from Aphria by contacting Aphria's investor
relations at investors@aphria.com.
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SOURCE Aphria Inc.
