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Premium on Aphria Vanished, No More ‘Failed Investment’

Premium vanished

Green Growth touted a 45% premium for Aphria shares when it made the offer in December. The offer valued Aphria (APHA) at 11 Canadian dollars. Since then, Aphria has increased and closed at 11.4 Canadian dollars on January 31. With Aphria slightly higher than Green Growth’s offer, the selling point of a 45% premium has vanished.

Green Growth's Premium on Aphria 2019-01-06

No more “failed investment”

In a bid to urge investors to take quick action, Green Growth stated that it received interest from “frustrated” Aphria shareholders in favor of the takeover. Green Growth stated that these shareholders “want a way out of a failed investment.” Aphria was on an increasing trajectory in  January and covered nearly 45% of the gains. Investors didn’t buy into Green Growth’s claims.

Investors appear to be sticking with Aphria. Despite the company being targeted by short sellers and being called a “failed investment,” investors see more value in Aphria as a company. Aphria has the ability to achieve its original goals.

The cannabis space is getting exciting. Investors are glued to companies (HMMJ) including Canopy Growth (WEED), CannTrust (CNTTF), and Supreme Cannabis (SPRWF).

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Next, we’ll discuss Aphria’s valuation compared to peers’ median.

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