Aphria Inc (OTCMKTS:APHQF), a company that deals with the growth of marijuana, has revealed plans to secure its global leadership in the marijuana industry and it involves acquiring key assets in the Caribbean and Latin America.
Aphria has proposed its acquisition of some of the leading companies in the marijuana industry from Jamaica, Argentina, and Colombia. The company plans to spend around $200 million to fulfill the acquisitions.
The assets that Aphria is currently eying in the three countries are either owned or are currently in the process of being acquired by Scythian Biosciences Corp, the sister company to Aphria as well as LATAM Holdings Inc, a subsidiary of Scythian Biosciences (OTCMKTS:SCCYF). Aphria will hand over 15.7 million shares to Scythian in exchange for LATAM Holdings in a deal averaging $12.31 per share which is equivalent to $193 million.
The deal will allow Aphria to own the Colombian firm Colcanna S.A.S. and the latter will, therefore, become the first firm in Colombia’s Coffee Zone to secure a license to produce cannabis extracts for medicinal purposes. It will also have a marijuana research license and a license for extracting and producing cannabis oils for the local market and the export market.
Aphria is planning to acquire a successful Argentine pharmaceutical company called ABP, S.A. that holds numerous licenses including a license for importing CBD oil. ABP is also involved in research pertaining to medical cannabis. Aphria plans to invest in Jamaica through Marigold Projects Jamaica Limited which holds numerous licenses granted by the Jamaican Cannabis Licensing Authority.
Securing an early lead in the increasingly competitive market
The acquisitions should allow Aphria to compete more effectively with other Canadian companies in the rapidly growing marijuana market. It also highlights the aggressive expansion strategies being employed by companies especially after the legalization of marijuana for medical and recreational use in Canada.
Some of the major marijuana companies such as Canopy Growth Corp (NYSE:CGC) have their sight set on Colombia because of its strong agricultural background and the fact that its export channels provide access to the rest of South America. Jamaica also has a positive stance towards marijuana while Argentina allows the importation of CBD products.