CanniMed adopts shareholder rights plan in takeover fight with Aurora Cannabis

  • Nov 29, 2017

SASKATOON - CanniMed Therapeutics Inc. says it has adopted a shareholder rights plan in a bid to defend itself against a hostile takeover offer by Aurora Cannabis Inc.

The company says the move will ensure its shareholders have a chance to vote on its own acquisition of Newstrike Resources Ltd. (TSXV:HIP).

The rights plan prevents Aurora from acquiring any CanniMed shares other than those tendered to its hostile bid or from entering into any lock-up agreements other than those it has already signed and filed, CanniMed says.

Aurora (TSX:ACB) has made an all-stock offer for CanniMed worth up to $24 per share, with one of its conditions being that CanniMed abandon its own proposed acquisition of Newstrike.

Aurora has also said that it has signed lock-up agreements with four CanniMed shareholders — which comprise 38 per cent of outstanding shares — to support its unsolicited takeover bid.

CanniMed (TSX:CMED) has said the Aurora acquisition does not make sense for its shareholders, but the combination with Newstrike will deliver significant shareholder value.