Canopy USA’s Acquisition Of Acreage Could Mean Staggering Losses For Some Shareholders
Acreage Holdings, Inc. (CSE:ACRG, ACRG.B.U)) (OTCQX:ACRHF, ACRDF)) said it anticipates that Canopy USA, LLC –Canopy Growth Corporation‘s (TSX:WEED) (NASDAQ:CGC) strategy for capturing the U.S. cannabis market will complete its acquisition of Acreage by mid-December, 2024.
The move could leave holders of Acreage’s Class E shares (fixed shares) with nothing. That is, if Canopy’s stock price price remains below $5 when the deal closes, Acreage pointed out in a Monday press release.
Why?
The convertible note offering completed in June caused significant dilution of Acreage’s fixed shares, leaving them without any worth at Canopy’s current share price.
“As a result of the material impact of the Offering it is anticipated that the current holders of Fixed Shares will receive zero value upon closing of the Acquisitions,” Acreage said.
Canopy’s shares traded 5.06% lower at $3.9401 per share at the time of writing on Tuesday morning. Acreage shares plunged more than 90% on Monday in reaction to the news.
The company also said holders of floating shares will get 0.045 of a Canopy share for each of their floating shares, which is a fixed exchange rate.