(Reuters) - Medical marijuana company Aurora Cannabis Inc (ACB.TO) said on Monday its acquisition-target CanniMed Therapeutics Inc’s CMED.TO plan to buy smaller rival Newstrike Resources Ltd (HIP.V) was a “terrible deal” for CanniMed shareholders.
Aurora said it would file a dissident circular and solicit votes against CanniMed’s decision to issue shares in connection with the proposed acquisition.
Newstrike has no revenues, sales license and patients, Aurora said, adding that CanniMed is paying a significant premium to bail out the company.
The move comes after the Ontario Securities Commission scheduled a hearing on CanniMed’s request to intervene in a hostile takeover bid by Aurora (ACB.TO) on Dec. 20.
Saskatoon, Saskatchewan-based CanniMed on Dec. 11 had asked the Financial and Consumer Affairs Authority of Saskatchewan and the Ontario Securities Commission to declare that Aurora’s move to take its buyout offer directly to CanniMed shareholders constituted an insider bid.
Last month, Aurora offered to buy CanniMed for C$24 per share but CanniMed adopted a plan to prevent shareholders from entering agreements with Aurora, viewing the deal to be “coercive”.
Reporting by John Benny in Bengaluru; Editing by Martina D'Couto