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Tilray Inc TLRY

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Raising Fair Value After Tilray Buys MedMen Convertible Notes for First Toehold Into U.S. THC Market

Analyst Note

| Kristoffer Inton |

On Aug. 17, Canadian cannabis producer Tilray announced that it and a group of strategic investors acquired roughly $166 million, or about 75%, of U.S. multistate operator MedMen’s senior secured convertible notes and related warrants. Tilray’s share in the deal gives it 68% of the outstanding notes and warrants, which would convert to about 21% of MedMen’s outstanding shares. The notes are convertible and warrants exercisable upon U.S. federal legalization, or Tilray’s waiver of such requirement. The deal gives Tilray its first option value into U.S. THC, akin to Cronos’ option to acquire a 10.5% stake in PharmaCann and Canopy’s options to acquire 27% of Terrascend and 100% of Acreage.

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Company Profile

Business Description

Tilray is a Canadian producer that cultivates and sells medical and recreational cannabis. In 2021, legacy Aphria acquired legacy Tilray in a reverse merger and renamed itself Tilray. The bulk of its sales are in Canada and in the international medical cannabis export market. U.S. exposure consists of CBD products through Manitoba Harvest and beer through SweetWater.

Contact
655 Madison Avenue, Suite 1900
New York, NY, 10065
T +1 844 845-7291
Sector Healthcare
Industry Drug Manufacturers - Specialty & Generic
Most Recent Earnings May 31, 2021
Fiscal Year End May 31, 2022
Stock Type Speculative Growth
Employees 2,100

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