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id: 348, Created by Stan Vick Chase, Scout
On May 3, 2021, Tilray and Aphria announced the completion of the previously announced business combination. The combined company had a market capitalization of over US$8 billion based on April 30, 2021.
The official press release stated, among other things, the following advantages of the merger for the business and its shareholders:
- Operational efficiencies are expected to generate approximately US$81 million annual pre-tax cost-saving synergies for New Tilray within eighteen months.
- New Tilray is poised to transform the global cannabis industry as a Consumer packaged goods powerhouse with a diversified portfolio of leading brands;
- Renewed financial strength to drive accelerated growth strategy and sustained profitability.
During the closing of the Deal, the shareholder's complaints appeared and generally alleged that Tilray and the members of its BoD did not include pieces of material information in the proxy statement. One of the complaints stated that the members of the BoD breached their fiduciary duties when they left key information out of the proxy statement.
On August 31, 2022, Bloomberg Law reported that "Aphria Inc. shareholders may represent a class in a suit alleging the Canadian cannabis producer and distributor misled investors about the condition of some assets it acquired, a federal court in New York ruled." pointing out "Self-interested directors allegedly behind asset purchase'. The allegations that stockholders relied on company misrepresentations are capable of common proof through a fraud-on-the-market theory, Judge George B. Daniels said for the Southern District of New York.
From the moment of the Deal, TLRY stock price already dropped more than 75% to date, seriously damaging investors.
Given all the public facts, the Company's and its Leaders' statements, and the results of the merger after almost 1.5 years, investors have reason to suspect that the Companies and their Leaders did not act in shareholders' best interests and properly disclosed information.
Failure to Disclose,
Breach of Fiduciary duty,
+$39,900,000Total Settlement Amount