Cannabis company Tilray Brands Inc. has signed a deal to take a stake in rival Hexo Corp. and launch a strategic partnership with the company.
Under the agreement, Tilray Brands will acquire up to US $211 million of senior secured convertible notes that were issued by Hexo and are held by funds affiliated with HT Investments MA LLC.
The notes will be amended to allow Tilray Brands to exercise conversion rights at a price of 90 cents Canadian per Hexo share.
The conversion price implies that Tilray Brands would have the right to convert the notes into a 37% stake in Hexo.
The deal will also see Tilray Brands and Hexo create a joint venture that will provide shared services to both companies.
The companies estimate that total savings, which will be shared equally, are expected to be up to C$50 million within two years.
THE ABOVE IS FROM CANADIAN PRESS
