Is Tilray Expanding Their Share Count To Ramp Up M&A?

After the market closed on Wednesday, Tilray, Inc. (TSX: TLRY) (Nasdaq: TLRY) filed a preliminary proxy statement with the United States (US) Securities and Exchange Commission (SEC) and we consider the filing to be significant.

Two key proposals that were highlighted in the preliminary proxy statement are related to increasing the number of authorized shares outstanding (from 743,333,333 shares to 990,000,000 shares) and expanding shareholder rights. 

The proposals were filed a month after Tilray completed a merger with Aphria. According to the filing, the combined company has the largest geographic footprint and a leading cannabis global brand portfolio that is comprised of consumer-packaged goods (CPG).

Following the completion of the merger, the management team is laser focused on executing on their highest-impact growth initiatives that include: business integration, cost-synergy realization, and accelerating its global growth strategy. 

Tilray has a highly scalable operational footprint, a curated portfolio of diverse medical and recreational cannabis brands and products, a multi-continent distribution network, and a capital structure that is structured to fund its global expansion strategy and deliver sustained profitability over the long-term.

Tilray wants to increase the amount of authorized shares to capitalize on organic and inorganic growth projects. The management team believes there are attractive acquisition targets available and we will monitor how the story advances from here.

A proposal that was included in the filing and that received less attention is related to Tilray being able to execute on growth projects before holding a special meeting. We believe this proposal would make it easier for Tilray to complete acquisitions and will monitor how these proposals are received by shareholders. 

Based on the Aphria merger, we expect Tilray to be able to pass these proposals and will monitor how the story continues to advance. The company has recently reported several major developments and this is a story that we are closely following. 

If you are interested in learning more about Tilray, please send an email to support@technical420.com with the subject “Tilray” to be added to our distribution list. 

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Michael Berger is Managing Partner of StoneBridge Partners LLC. SBP continues to drive market awareness for leading firms in the cannabis industry throughout the U.S. and abroad.

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